NEW DELHI: Automobile retail sales across categories, including passenger vehicles and two-wheelers, witnessed a drop of 7% in Feb, amid declining demand, dealers’ body FADA said on Thursday. Overall, retail sales in the domestic market stood at 18.9 lakh units last month compared to 20.5 lakh units in the year-ago period.
“Feb witnessed a broad-based downturn across all categories,” FADA president C S Vigneshwar said. During the month, dealers began expressing concerns about inventory being pushed to them without their consent. “While such initiatives may serve broader business objectives, it is critical to align wholesale allocations with genuine demand to protect dealer viability and ensure healthy inventory management,” Vigneshwar said.
Passenger vehicle retail sales declined 10% year-on-year to 3 lakh units in Feb. “Dealers noted weak market sentiment, which specially continues in the entry-level category, delayed conversions, challenging targets and stressed that OEMs should avoid overburdening dealers with excessive inventory – a practice that risks unmanageable stock levels given the cyclical nature of the industry,” Vigneshwar said. Inventory levels in this segment remained in the range of 50-52 days, he said.
Two-wheeler sales witnessed a drop of 6% year-on-year in Feb at 13.5 lakh units as compared to 14.4 lakh units sold in Feb last year. Dealers attributed this to inventory imbalances, aggressive pricing adjustments, weak consumer sentiment, lower enquiry volumes and limited finance availability, Vigneshwar noted.