New Vehicle Retails In February 2022 Down 4.5% Over January, YoY Sales Drop Over 9%

The Federation of Automobile Dealers Associations (FADA) has released vehicle retail data for the month of February 2022. Last month, the cumulative new vehicle retail sales stood at 13,74,516 units, a month-on-month decline of 4.5 per cent compared to 14,39,747 vehicles sold in January 2022. In comparison, a year ago in February 2021, vehicle retails stood at 15,13,894 units, which leads to a year-on-year decline of over 9 per cent in February 2022. FADA President, Vinkesh Gulati said, "Indian Auto Industry during February continues to remain in red as total retails were down by 9.21 per cent YoY and 20.65 per cent when compared to February 2020, a regular pre-covid month."

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Compared to the 2,58,337 vehicles sold in February 2021, the passenger vehicle segment saw a YoY decline of nearly 8 per cent

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In February 2022, the passenger vehicle segment saw total retail sales of 2,38,096 units. Compared to the 2,58,337 vehicles sold during the same month in 2021, the segment saw a YoY decline of nearly 8 per cent. Talking about the PV segment, Gulati said, "Even though the PV segment saw some launches and slight respite in supply due to better production, it was not enough to meet customer demand. Vehicle waiting period thus remains similar to what it was in last few months." The industry is currently facing supply constraints due to the global shortage for semiconductor chips.

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The two-wheeler segment, on the other hand, saw a higher YoY decline of nearly 11 per cent in retail sales. In February 2022, total sales from the segment stood at 9,83,358 units, compared to 11,00,754 vehicles sold during the same month in 2021. Gulati said, "The two-wheeler segment is showing no signs of recovery as Bharat continues to play spoil-sport. With cost of acquisition continuously going north, inquiry level remained weak. As corporates and educational institutions continued operating from home, urban demand also took a hit."

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The two-wheeler segment saw a higher YoY decline of nearly 11 per cent in retail sales at 9,83,358 units

However, things were different for the commercial vehicle segment. The CV space, which includes light, medium and heavy commercial vehicles among others, saw total retail sales of 63,797 units in February 2022. Compared to 59,395 units sold in February 2021, the segment saw a rise of nearly 8 per cent in retail sales. The heavy commercial vehicle segment saw YoY growth of 21 per cent at 19,822 units in February 2022. Three-wheeler sales also grew by nearly 17 per cent at 38,961 units. In comparison, the segment sold 33,404 units in February 2021. However, tractor sales saw a big dip of 19 per cent in retail sales, at 50,304 units. Last year in February, the segment's total retails stood at 62,004 units.

The CV space, which includes light, medium and heavy commercial vehicles among others, saw total retail sales of 63,797 units in February 2022

In its outlook for the near future, FADA said that the ongoing unrest between Russia and Ukraine will once again have ripple effects on the global automotive supply chain. The apex body for auto dealers' association said, "Russia is one of the largest producers of rare-earth metals especially Palladium, which is an essential metal for semi-conductors. Ukraine on the other hand is one of the biggest producers and exporter of Neon Gas, which is used in the manufacturing of semiconductors." FADA fears that the ongoing war will once again lead to a shortage of semiconductors, which will create additional supply side issues for passenger vehicles.