On a YoY basis, overall Vehicle Registrations rise by 4%.
The Federation of Automobile Dealers Associations (FADA) released the Monthly Vehicle Registration Data for the Month of October’19.
• October Vehicle Registrations finally shows positive momentum with the biggest 2 festivals of Navratri/Dussehra and Diwali being in the same month. Never before seen attractive offers boosted the Overall Positive Mood of the Buyers.
• On a YoY basis, overall Vehicle Registrations rise by 4%. 2-Wheeler was up 5%, 3-Wheeler was up 4%, PV was up 11% and CV registered a de-growth of -23%.
• On inventory front, PV inventory already being at reasonable levels, saw a further marginal drop reaching the ideal mark. CV inventory also reduced but still remains above comfortable levels heading into the BS6 implementation.
• Much needed Respite to 2W dealers with Substantial Inventory Reduction with Retail growth and Regulated wholesale supplies by all OEM’s.
• FADA remains cautious for the near and mid-term post the Festive seasons as BS VI transition approaches and Rural Demand yet to pick up due to Extended and Excessive monsoon.
• Business Appetite of Banks NBFC’s seen to be growing and will aid in Demand Recovery in the coming months.
Charts showing Vehicle Registration Data for October’19 with YoY comparison:
Vehicle Registration Data for October’19:
October-19 Retail Sales
Commenting on October’19 performance FADA President, Ashish Harsharaj Kale said “We thank all our principals for taking stock reduction measures.
FADA specially appreciates the actions taken by our 2W OEM’s for delivering on their commitment, of reducing stock with Festival Retail Growth. Although not at FADA recommended levels of 21 days, 2W inventory has reduced from an alarming level. PV inventory already at reasonable levels has further reduced and now almost at the recommended level with all our principals taking strong and positive steps towards stock reduction. CV inventory has also reduced although with retail continuing to be weak, where further wholesale regulation is required to reach FADA’s 21 days recommended levels.
Heading into the unknown territory of BS6 transition, more needs to be done towards inventory reduction to avoid dealer losses.
October retails were in the positive giving a much-needed respite to the auto industry and especially our dealer community after months of de-growth. The Festivals saw very good footfalls at dealerships across most of the geographies, the consumer sentiment was positive, and purchase decisions were concluded as used to be during the growth years.
Strong Support from Bank’s & NBFC’s helped Convert the Festive mood of the Consumer into Retails. With Continued Liquidity Easing, Business Appetite of Banks & NBFC’s have grown and will surely aid the industry in the path to recovery as the Consumer Sentiment Strengthens in the coming days. FADA requests both Banks and NBFC’s to provide more support for a stronger recovery.
As the Complete effect of the positive measures taken by the Government plays out and Banks and NBFC’s aggression continuing post the festive season, strengthening of Demand is expected along with bottoming out of the De-growth.
With a New Normal now being more or less set, FADA expects the near term to be stable and Consumer Sentiment changing for the positive as the Economy heads towards recovery with the Governments Strong Focus and Actions towards it.
FADA continues its recommendation to its members to tread with Caution, especially with regards to inventory and Costs during this dynamic time of Fluctuating Consumer Sentiment due to Overall weak economic situation and BS6 transition
FADA will also continue to engage with all the stakeholders for a smooth transition into the BS6 Regime for its members.”
Key Findings from our Online Members Survey
o 13% Dealers rated it as Bad (41% in Septembert’19)
o 45% Dealers rated it as Neutral (41% in September’19)
o 41% Dealers rated it as Neutral (56% in September’19)
o 10% Dealers rated it as Bad (34% in September’19)
• Festive Period
o 43% Dealers rated it as Growth
o 30% Dealers rated it as Flat
o 27% Dealers rated it as De-Growth
• Expectation in November
o 48% Dealers rated it as Flat
o 33% Dealers rated it as De-Growth
o 19% Dealers rated it as Growth
o Average inventory for PVs ranges from25 – 30days (30-35 days in September’19)
o Average inventory for 2W ranges from35– 40days (60-65 days inSeptember’19)
o Average inventory for CV ranges from40 – 45 days (50-55 days inSeptember’19)