Vehicle Retail Sales For August 2021 Fell 11% Against July, But Saw 14% YoY Growth

The Federation of Automobile Dealers Associations (FADA) has released vehicle retail data for the month of August 2021. Last month the total new vehicle registrations stood at 13,84,711 units. Compared to 15,56,777 units sold in July 2021, the industry witnessed a month-on-month decline of 11 per cent. However, the auto sector also witnessed a year-on-year growth of 14 per cent compared to the 12,09,550 vehicles retailed in August 2020. While this is encouraging, the MoM decline in retail sales is certainly a worrying matter. It's a direct result of the supply constraints the industry is facing due to shortage of semiconductor chips.

Also Read: Maruti Suzuki India Expects 60% Cut In Vehicle Production In September Due To Chip Shortage

Commenting on August 2021's performance, FADA President, Vinkesh Gulati said, "Auto Dealers are facing the most challenging phase of their business career as Covid-19 after-effect continues to play spoil-sport. While until last year, when demand was a challenge, supply is becoming a bigger problem currently due to shortage of semiconductors, even though there is high demand for passenger vehicles." In fact, several manufacturers, including Maruti Suzuki India, Mahindra, and Tata have announced production cuts in September due to chip shortage. Gulati further added, "Every dealer by now starts planning for a bigger offtake in anticipation of a bumper festive but due to supply issues, inventory levels are at lowest levels during this Financial Year."

Also Read: India's Mahindra And Mahindra Flags Production Hit Due To Chip Shortage

Total passenger vehicle sales in August 2021 stood at over 2.53 lakh units

In the passengers vehicle segment, total retail sales for August stood at 2,53,363 units, a 39 per cent growth compared to 1,82,651 units sold in the same month in 2020. However, a more realistic comparison would be with July 2021, when PV sales stood at 2,61,744 units, resulting in a 3 per cent MoM decline in August 2021. The two-wheeler segment, on the other hand, reported 9,76,051 units being registered in August, which is 7 per cent growth compared to 9,15,126 units sold in August 2020. However, compared to the 11,32,611 two-wheelers sold in July 2021 the segment saw a 14 per cent decline.

9,76,051 two-wheelers were sold in August, which is 7 per cent growth compared to August 2020

The three-wheeler segment saw 30,410 new registrations in August 2021, a growth of nearly 80 per cent compared to 16,923 units retailed during the same month in 2020. However, compared to the 27,904 three-wheelers sold in July 2021, the segment reported a more realistic growth of 8.2 per cent.

In August 2021 the CV segment saw a marginal MoM growth of 2 per cent, against 52,130 sold in July 2021

In August 2021, total commercial vehicle sales touched 53,150 units, a 98 per cent growth compared to 26,851 units retailed during the same month in 2020. However the CV segment saw a marginal MoM growth of 2 per cent in August, against 52,130 sold in July 2021. Total tractor sales, at the same time, stood at 71,737 units, a 5.5 per cent growth compared to 67,999 units sold in August 2020. However, compared to 82,388 units sold on July 2021, the industry saw a MoM decline of 13 per cent.