The end of last year did not go well for car dealers. Overall sales from showrooms picked up quite a bit in the months leading up to the festive season. But in December that demand faltered again. 2022 could not leave the business of 2019 even as a whole year. All these car sales figures were revealed on Thursday by the dealers’ association FADA’s message, due to various reasons like financial uncertainty, increase in car prices, they are cautious about the business situation in the last quarter of the current financial year (January-March).
Citing government statistics, FADA said overall vehicle sales in December last year fell by 5.40% compared to the same period in 2021. Compared to December 2019 and December 2020, the sales decline is even higher, at 11.89% and 21.15%, respectively. But looking at the whole year can provide some relief. Last year’s sales increased by 17.17% and 15.28% from the previous two years (2020, 2021) respectively. Although compared to 2019 it is 9.81% less. The country was in economic turmoil at that time.
Reasons of decline in sales
Next year the business was hit by the Covid infection. Before it took its toll, the global financial crisis, soaring commodity prices, rising car manufacturing costs, and the need for manufacturers to curtail production due to shortages of some parts put a thorn in the way of business. Dealers are wary of this from the beginning of this year as well. As a result, the concerned circles are raising the question whether the car market has actually been able to turn around at all. Especially since two-wheeler sales are still low.
However, sales of passenger cars have increased significantly. Demand for tractors, commercial and three-wheelers has also increased. FADA’s President Manish Raj Singhania said that the overall sales decline as compared to last December or last year is due to the shock in the demand for those two wheelers. This is because the rural economy is yet to fully recover.
How do dealers expect business to be in the next few days? According to FADA, the first 15 days of January are already low in demand. Various car companies have recently announced price hikes. Also, when the second phase of BS-6 norms are introduced from April, the price of cars is likely to increase again. The rate of price increase is also high. As a result, the business of January-March is upheld. So they requested the manufacturing companies to launch special projects.
Fear in statistics
• Overall car sales fell by 5.40% last month from December 2021.
• A contraction of 11.89% over December 2019.
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