Domestic auto sales saw a 20.35 % YoY jump across vehicle categories in FY ’23 with the net tally at 21.2 million units against 17.61 million units recorded a year earlier. The output of FY ’19 at 26.16 million units still remains the best achieved so far.
Passenger vehicle sales grew 26.7% to 3.89 million units and, in the process, surpassed the previous peak of 337 million units in FY ’19. SUVs saw the biggest jump with sales of 2 million units, a jump of 34.5% and accounting for 48.4% of total PV numbers. Passenger cars were up 19.1% to 1.74 million units.
Vinod Aggarwal, President, SIAM, said at a press meet here on Thursday that while the SUV space continues to see more demand, the entry-level car segment is still losing ground. The reasons for this are a preference for electric vehicles (where they are happy to wait) to the price hikes in entry-level cars.
Aggarwal was, however, confident that this fiscal would see a rise in demand for this segment and added that manufacturers needed to be more cost-conscious here.
2-Wheelers Face The Heat
The 2-wheeler space also posted good growth of 16.89% to 1.58 million units but, as in the case of cars, it is the entry-level motorcycle that is facing the brunt of high price tags. Despite showing some growth, Aggarwal said it was still far behind its peak of 21.18 million units in FY ’19 and below the FY15 levels.
SIAM data also shows that mopeds are the worst hit due to poor rural sentiment while scooters and motorcycles are facing challenges too. Rajesh Menon, Director General, SIAM, said mopeds were 50% down from the peak of FY ’19 while scooters and motorcycles were 27% and 38% down compared to this period.
Meanwhile, three wheelers grew almost 90% to 488,768 units though the record high of 526,000 units in FY ’11 stays intact. According to Aggarwal, sentiments are positive in this segment with passenger options growing faster than their goods counterparts.
CNG As Catalyst
This trend is evident in the commercial vehicle segment too which grew by 34.3% to 962,468 units and inching close to its previous peak of a little over 1 million units achieved in FY ’19. Menon said with the recent cut in CNG prices, there would be greater preference for this fuel in buses. The Centre’s focus on infrastructure spending is also expected to power sales of CVs.
While FY ’23 reported good news from the domestic market, exports have fallen by 15.2% to 4.76 million units from 5.61 million units in the preceding year. The exception was passenger vehicle exports which grew 14.7% while CVs, 3Ws and 2Ws were down by 14.7%, 26.8% and 17.8% respectively.
Aggarwal said initiatives such as the PLI scheme, encouraging announcements in the Budget, forward looking logistics and foreign trade policies as well as the recently announced gas pricing guidelines augured well for the industry.
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