Auto sales dip month-on-month in April due to rise in Covid-19 cases: SIAM

Sales of automobiles saw a double-digit decline over March last month, mainly due to the restrictions imposed by state governments to contain the sharp rise in Covid-19 cases in the country. The industry had recorded zero sales in the same period last year amid a nationwide lockdown.
Data from industry body Society of Indian Automobile Manufacturers showed passenger vehicle sales last month stood at 261,633 units, two-wheeler sales at 995,097 units and three-wheeler sales at 13,728 units. The data does not include volumes of Tata Motors, which has stopped reporting monthly sales to SIAM. Tata Motors sold 25,095 passenger vehicles in April 2021.



Automakers in India mostly report wholesale dispatches from factories and not retail sales to customers. “As expected, the Covid-19 wave has impacted the sales of vehicles in the month of April 2021. Sales of passenger vehicles fell by 10.07 %, compared to March 2021, due to various restrictions in states which have been experiencing surge in Covid-19 cases. Sales of two-wheelers have also plummeted by 33.52 %, while three-wheelers witnessed a de-growth of 57.01 %, from March 2021 to April 2021”, said Rajesh Menon, director general, SIAM.

Supply chain related production challenges continue with the lockdown restrictions in many parts of the country. Menon added, “The demand has been clearly impacted by second wave of Covid-19, both in terms of low consumer sentiments and closure of dealerships due to lockdown restrictions.”

With nearly 75% of auto retail stores across the country shut due to restrictions imposed by local administrations to check the spread of the disease, and most leading automakers announcing and extending maintenance shutdowns at factories, vehicle sales are expected to fall further in May.

“Covid second wave and lockdowns in various geographies impacted retail sales during the month. Deeper penetration of Covid into rural India, with higher severity this time, has more impact on the economy, including automobile industry at present. Moreover, supply issues due to the lockdown and unavailability of O2 for industrial usage continue to impact vehicle production. Therefore, sales volume for the month of May 2021 would witness more disappointing sales performance,” said Mitul Shah, head of research at Reliance Securities.