Lockdown relaxation accelerated June auto sales growth: India Ratings

Relaxation of localised lockdowns in most parts of the country led to the sequential as well as year-on-year increase in domestic auto sales volumes in June 2021


Auto sales | Lockdown | Coronavirus

IANS  | 
New Delhi 

Relaxation of localised lockdowns in most parts of the country led to the sequential as well as year-on-year increase in domestic auto sales volumes in June 2021, India Ratings and Research (Ind-Ra) said.

Accordingly, the agency, credited the trend on the reopening of automotive dealerships and the resumption of operations by original equipment manufacturers (OEMs) along with a lower base in previous periods.

“However, the June 2021 volumes remained much below historical peaks (35 per cent below June 2019 levels). The PV segment resumed its outperformance compared to the industry on account of increasing preference for personal mobility by 119 per cent YoY.”

Besides, the report pointed out that consumer demand for the 2W segment remained tepid, at up 4 per cent YoY.

“While motorcycle sales increased by 10 per cent YoY, and scooters sales fell by 10 per cent YoY. 2Ws has been more impacted by the increased cost of ownership amid price hikes by OEMs coupled with historically high fuel prices in India and workplace and colleges remaining closed.”

“3Ws continued to drag with a 9 per cent YoY decline due to reduced preference for shared mobility. The growth trend in exports volumes resumed in June, after being disrupted by the second covid wave in May, as export volumes increased 82 per cent YoY.”

Furthermore, the total production in June 2021 improved by 110 per cent on a monthly basis as OEMs resumed operations at their plants after taking 10-15 days of shutdown in May 2021.

“Retail sales also recovered in June 2021 – with PV and 2W volumes increasing 43 per cent and 17 per cent YoY, respectively, due to the reopening of automotive dealerships. Inventory at the dealership levels for PVs increased to 30-35 days in June 2021.”

“Ind-Ra believes that the increase was due to OEMs replenishing inventory with dealers in anticipation of a pent-up demand and supply chain issues on account of a shortage of semiconductors.”

In addition, the agency said it expects the recovery in sales volumes to continue in July 2021, driven by the lockdown restriction being lifted in some more parts of the country and a steady decline in daily new covid cases.



(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor