Retail Car Sales Come Off The Cliff In November In Aftermath Of Festive Demand

Retail car sales in India came off a cliff in November 2024 as a tepid wedding season failed to support demand in the aftermath of the festive season.

To be sure, a year-on-year comparison, or even sequential, of VAHAN data isn’t accurate since the festive season last year was split between October-November. This year, it was concentrated in October with Dussehra, Dhanteras and Diwali in the same month. This festive period is crucial, for it brings in about a third of the industry’s annual sales.

Still, that inventory levels reduced by just 10 days in the aftermath of the festive season is emblematic of the “atypical year” Indian Auto has had in 2024 so far.

While November was initially expected to build on prior momentum, particularly due to the wedding season, dealer feedback suggests that this segment underperformed overall expectations, FADA President CS Vigneshwar said in the media statement. “Although rural markets offered some support, primarily in the two-wheeler category, wedding-related sales remained subdued. The late occurrence of Diwali aided volumes.”

But there’s no denying the notable headwinds afflicting the car industry, especially the inventory overhang that’s threatening to spill over into next year. In the current scenario, carmakers will enter 2025 with two months of unsold stock. 

“Inventory levels have reduced by 10 days, but continue to remain high at 65-68 days. FADA continues to urge OEMs (original equipment manufacturers) to further rationalise inventory so that the industry can enter the new year on a healthier footing, reducing the need for additional discounts.”