Car Retail Sales Surge 33% In October But Inventory Stays At 75-80 Days

Car retail sales rose by nearly a third in October 2024 but that did precious little to address the inventory situation in the world’s third largest automotive market.

To be sure, the festive outperformance may just be a flash in the pan.

Volumes may just come off a cliff, Ravi Bhatia of Jato Dynamics indicated. The demand just may not sustain as the calendar year draws to a close. 

“October’s relief rally, while impressive, faces immediate headwinds from the VIN year change and persistent entry-level segment challenges,” he said. “The industry needs to address these structural issues for sustainable growth.”

VIN is short for Vehicle Identification Number, a unique 17-character code that identifies a vehicle. It contains information on when and where a vehicle was manufactured, and by whom. It includes details on the engine type, original features and specifications.

Bhatia believes that carmakers will persist with discounts to prop sales in the second half of Fiscal 2025, amid a key overhang that is a sticky inventory situation.

Still, the upcoming wedding season—4.8 million weddings are expected in November and December—is likely to fuel demand for passenger cars and motorcycles. A steady crop yield can boost rural sentiment further, aiding higher vehicle sales.

“While the industry is optimistic about near-term growth driven by the wedding season and favourable market conditions, dealers are mindful of potential challenges that could affect sales momentum as the year concludes,” FADA’s Vigneshwar said. “The mixed sentiments highlight the need for strategic planning and cautious optimism as the Indian auto sector navigates the remaining months of the year.”