Auto sales rose 9% in 2024 on strong demand for two-wheelers: Federation of Automobile Dealers Associations (FADA)

Automobile retail sales increased by 9% YoY in 2024, driven by strong demand for two-wheelers and passenger vehicles, despite a challenging business environment, according to the Federation of Automobile Dealers Associations (FADA). Total vehicle registrations reached 2,61,07,679 units in 2024, up from 2,39,28,293 units in 2023. FADA President Mr. C. S. Vigneshwar noted that the auto retail sector remained resilient despite challenges such as heatwaves, elections at both central and state levels, and unpredictable monsoons. The two-wheeler segment grew due to improved supply, new model launches, and strong rural demand. However, finance constraints and increased competition from Electric Vehicles (EVs) persisted. 

The Passenger Vehicle (PV) segment grew by 5%, reaching 40,73,843 units, compared to 38,73,381 units in 2023, aided by network expansion and new product launches. However, the segment faced margin pressures, driven by higher inventory levels and aggressive discounting in the latter half of the year. Three-wheeler registrations also grew by 11%, reaching 1,221,909 units, while tractor sales increased by 3%, totalling 894,112 units. Commercial vehicle sales remained flat at 1,004,856 units. FADA expects growth in the two-wheeler segment, driven by rising rural incomes, new model launches, and a stabilizing EV market. For passenger vehicles, dealers anticipate strong consumer interest due to new SUV launches and feature-rich EVs. However, price sensitivity and interest rate fluctuations remain concerns. In December 2024, retail sales dropped by 12%, totalling 1,756,419 units, with two-wheeler and passenger vehicle sales falling by 18% and 2%, respectively, due to high inventory levels and intense discounting. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.