Auto Retail Sales Rise 11% In 2023 With Growth Across Categories

Retail sales of automobiles rose 11% year-on-year to 2.39 crore units in the calendar year 2023, with all categories witnessing growth.

The sales were driven by two-wheelers, which rose 9.5% to 1.7 crore units, contributing nearly two-thirds to the overall auto sales in the year, data from the Federation of Automobile Dealers Associations showed.

"With this resurgence in consumer confidence, the forecast for CY'24 is decidedly optimistic," FADA said in a statement. "Each sector within the auto retail industry is positioned for growth, navigating through the dynamic market conditions."

Auto Retail Sales In 2023 (YoY)

• Two-wheeler sales rose 9.5% to 1.71 crore units.

• Passenger vehicle sales grew 10.6% to 38.6 lakh units.

• Commercial vehicle sales rose 8.3% to 9.94 lakh units.

• Three-wheeler sales surged 58.5% to 10.81 lakh units.

• Tractor sales grew 7.1% to 8.72 lakh units.

In December, overall auto sales grew 21% to 19.91 lakh units, with a 28% jump in two-wheeler sales to 14.5 lakh units.

An abundance of marriage dates and the distribution of harvest payments to farmers drove the two-wheeler sales higher, according to FADA President Manish Raj Singhania.

The retail body believes the upcoming elections and an overall better economic condition will increase spending in the category in the upcoming months.

The passenger vehicle retails grew 2.7% to 2.93 lakh units in December, even as higher discounts across categories were offered to spur sales.

While carmakers such as Maruti Suzuki India Ltd. earlier this month claimed that inventory has come down from the concerning levels of 28–30 days, the retail body continued to flag higher stock.

"This ongoing issue of high PV inventory, despite a slight decrease by year-end, remains a critical area for OEMs to address, emphasising the need for further moderation in inventory management," Singhania said.

Retail Sales In December (YoY)

• Two-wheeler sales rose 28% to 14.5 lakh units.

• Passenger vehicle sales grew 2.7% to 2.93 lakh units.

• Commercial vehicle sales rose 1.3% to 73,896 units.

• Three-wheeler sales surged 36% to 95,449 units.

• Tractor sales grew 0.2% to 78,872 units.

Sales of commercial vehicles rose 1.3% to 73,896 units in December due to pre-buying in the sector.

The category continues to see good advance bookings and positive market sentiments due to supportive government policies and infrastructural projects.

Delayed harvesting and sowing limited tractor sales growth to 0.2% in the month. Analysts expect sales to be soft in the coming few months.