Auto sales grow over 10% in FY24; passenger vehicle sales touch all-time high
Upstox
2 min read • Updated: April 8, 2024, 3:07 PM
Summary
Diminishing urban consumer sentiment, competition and election uncertainties are some of the headwinds for the Indian auto retail industry. The sector is banking on popularity of EVs, festive season and government policies to maintain steady demand.
Indian auto retail sales logged double-digit growth in FY24, backed by momentum in the sale of 3-wheelers and passenger vehicles. According to data from the Federation of Automobile Dealers Associations (FADA), total vehicle retail sales stood at 2,45,30,334 units, a surge of 10.29%.
During the year, the 3-wheeler segment witnessed strong demand, resulting in a 49% YoY growth. Demand was underlined by the introduction of cost-effective CNG fuel options, the launch of new EV models, the broadening of city landscapes, and demand for last-mile mobility in urban areas.
The passenger vehicle (PV) segment touched an all-time high of 39,48,143 units, rising 8.45% during FY24. The growth was fueled by improved vehicle availability, a compelling model mix, and major contributions from the SUV segment, which now accounts for a 50% market share.
FADA President, Manish Raj Singhania said, “In FY24, the 2W segment saw a 9% growth, driven by a rich mix of factors including enhanced model availability, new product introductions, and positive market sentiment, further augmented by special schemes and the rural market's recovery from COVID-19.
During the month of March, the 2-wheeler EV market share jumped to 9.12% for the first time. This was in part supported by the FAME 2 subsidy scheme, which expired on March 31, 2024.
Mr. Singhania said the 2W segment demonstrated “resilience and adaptability” in March 2024. “The positive market sentiment was supported by seasonal events, improved vehicle supply, and financial incentives,” he added. “Despite facing market volatility and intense competition, the industry is strategically evolving, particularly in the premium and EV categories, signalling a bright future,” he noted.
According to the report, diminishing urban consumer sentiment, competition, and election uncertainties are some of the headwinds the sector is experiencing. Auto sales are banking on the momentum from the festive season, new product launches, favourable outlook toward electric vehicles, robust economic growth, advantageous government policies, and good monsoon to fuel demand.