Two-wheelers drag down vehicle registrations 13.43% in February 2021: FADA

Auto industry has been seeing positive growth and recovery for a V-shape. But looking at the numbers released by the Federation of Automobile Dealers Associations (FADA) on Tuesday for the month of February show a decline in the numbers as things are still not good.

According to FADA, new vehicle registrations in India declined by 13.43%; from 17,31,628 units in February 2020 to 14,99,036 units last month. This decline is mainly due to a fall in demand for two-wheelers, three-wheelers, and commercial vehicles in the country.

The dealers’ association said that two-wheeler registrations dropped by 16.08% last month as compared to February 2020; a total of 10,91,288 two-wheelers were registered in India last month as opposed to 13,00,364 units of two-wheelers during the same time last year.

Commercial vehicle sales also saw a decline of 29.53% to 59,020 units, as against 83,751 units a year ago. Three-wheeler too needs a boost as the sales three-wheeler fell 49.65% to 33,319 units last month, from 66,177 units in the year-ago period.

However, passenger vehicle (PV) retail sales in February saw an increase of 10.59%. FADA collected vehicle registration data from 1,274 out of the 1,481 regional transport offices (RTOs),  a total of 2,54,058 new cars were sold in India last month as compared to 2,29,734 units in February 2020.  Also, Tractor sales grew by 18.89 per cent to 61,351 units last month, against 51,602 units in the same month last year.

Commenting on the sales data, FADA President Vinkesh Gulati said, “the passenger vehicle sales witnessed double-digit growth last month on the low base of last year. Sales had dropped in February last year as the transition process from BS-IV to BS-VI emission norms had begun during the period.’’

“Besides the global semiconductor outrage kept the waiting period of passenger vehicles as high as eight months. FADA survey showed that 50 per cent of dealers lost over 20% of sales due to the non-availability of vehicles. Supply-side constraints have also impacted the registrations, Gulati said.

Two-wheelers sales continue to see sluggish demand due to the new wave of COVID-19 in certain states kept customers away, the increasing fuel prices also made customers move away from buying a new vehicle. And, high fuel prices would continue to negatively impact two-wheeler and commercial vehicle sales.

Commenting on commercial vehicle registrations he noted that offtakes continue to be impacted due to financing issues and there have been negligible sales of passenger buses due to the closure of educational institutes.

“The Federation also urges the Union Government to hold diplomatic discussions with countries manufacturing semiconductors (Taiwan and other similar countries) so that the momentum which was built so far in auto sales is not lost and the industry continues to fuel the recovery process,” Gulati said.

The dealers association is also expecting the Ministry of Road Transport and Highways to announce the specifics of the vehicle scrappage policy.