After experiencing disruptions due to heavy rainfall in September, Indian consumers returned to showrooms in October. With all major festivals – Navratri, Dussehra, Dhanteras, and Diwali – taking place during the month, rather than spread across two months as is usually the case, October stimulated significant consumer demand.
Automakers seized the opportunity presented by this festive period through the launches of several “Limited Edition” models, while maintaining momentum with attractive offers and price reductions to bolster sales.
Go deeper with GlobalData
As a result, total Light Vehicle (LV) wholesales in October rose by 12% month-on-month (MoM) to 460k units. However, this figure represented only a 3% year-on-year (YoY) increase. Passenger Vehicle (PV) sales reached 392k units, marking an 11% MoM expansion and a 2% YoY rise. Meanwhile, demand for Light Commercial Vehicles (LCVs) with a gross vehicle weight of up to 6T stood at 68k units, up by 16% MoM and 8% YoY.
Moreover, retail sales of PVs and LCVs surged to 539k units in October, a significant rise from 317k units in September, according to data from the Federation of Automobile Dealers Associations (FADA). This represents a remarkable 70% MoM growth.
PV retail sales soared by 75% MoM, driven by festive demand, aggressive promotions, and the launch of new models. Improved vehicle availability and strong market interest, particularly for SUVs and new products, also contributed to the sales performance, as FADA noted.
Additionally, retail sales of LCVs in October grew by 34% MoM. This growth was partly fueled by the rural market, following the government’s announcement of an increase in the Minimum Support Price (MSP) for Rabi crops. The enhanced MSP for these winter-sown, spring-harvested crops helped bolster market sentiment. There was also a rebound from the September slowdown, when heavy rainfall had negatively impacted sales volumes.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataCumulative LV wholesales from January to October grew by 3% YoY to 4.1 million units. This total included 3.5 million PVs (+4% YoY), and 584k LCVs (-1% YoY).
Preliminary data for November from the top five automakers indicates a reduction in dispatches compared to the previous month, which aligns with expectations as demand typically subsides after India’s festival period.
The market leader, Suzuki Group, reported a 12% MoM decrease in PV wholesales, while Hyundai’s volumes fell by 13%. Tata Motors also experienced a modest 2% MoM decline, while Mahindra’s PV wholesales decreased by 15%, and Toyota’s figures (predominantly PVs) dropped by 9% compared to the previous month.
Examining macroeconomic factors, consumer spending accelerated during the peak festive season in October. Above-normal monsoons caused damage to some crops and led to inflation but also benefited other crops and enhanced rural income.
However, persistently high interest rates and a weakening rupee continue to suppress domestic demand overall. Inflation climbed to 6.2% YoY in October due to higher food prices, exceeding the central bank’s target range for the first time in over a year and complicating the bank’s transition to monetary easing.
The sales forecast remains largely unchanged, with only minor adjustments projected for 2024. Sales are anticipated to reach an all-time high of 4.9 million units (+3.4% YoY) in 2024 and 5 million units (+2.6% YoY) in 2025.
Looking ahead, India’s LV sales are projected to rise to 6.5 million units by 2031, representing a CAGR of 4% over the seven-year period. Our cautious optimism is based on the investment plans of major OEMs to expand capacity and introduce new products, including Battery Electric Vehicles (BEVs), aggressively. This heightened competition and the availability of increasingly attractive and affordable models are expected to stimulate sales.
This article was first published on GlobalData’s dedicated research platform, the Automotive Intelligence Center.
Related Company Profiles
Suzuki Motor Corp
Hyundai
Tata Motors Ltd
Mahindra & Mahindra Ltd
Toyo Tanso Co Ltd