Rising fuel prices fail to dampen passenger vehicle sales

Auto dealers expect passenger vehicle (PV) sales to stay robust despite a sharp rise in petrol and diesel prices, according to a report in Mint.

Pent-up demand and shift in consumer preference for personal mobility are expected to drive sales in the coming months, automobile dealers told the publication. The confidence also stems from the fact that car models of certain automakers currently command waiting periods of a few months while factories are running at full capacity to cope with the demand.

The sales growth will also come on a low base since PV sales suffered last year due to the pandemic and increase in vehicle prices following the shift to BS-VI emission norms.

A Maruti Suzuki dealer in Bengaluru said retail sales in January and February rose 20-25% from a year ago period and expects sales to grow in the coming months on a sequential basis.

“We have not seen much impact of increase in oil prices in the past two months. Currently, Maruti does not have adequate vehicles at dealerships and the supply is also not matching the demand of the dealers,” the dealer told the publication, requesting anonymity.

PV retail sales saw a 4.46% year-on-year dip in sales to 281,666 units in January after growing for two consecutive months, according to FADA data.