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Automobile sales drop 6% YoY in July 2019, commercial vehicles most affected

Automobile sales drop 6% YoY in July 2019, commercial vehicles most affected

Automobile sales drop 6% YoY in July 2019, commercial vehicles most affected
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By CNBC-TV18 Aug 20, 2019 7:41:35 AM IST (Updated)

Two-wheeler sales dipped by 5 percent, passenger vehicles (PV) by 11 percent and commercial vehicles (CV) by 14 percent, showed the data.

The Federation of Automobile Dealers Associations (FADA) on Monday released the July 2019 vehicle registration data, which showed that on a year-on-year (YoY) basis, the overall sales declined 6 percent.

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Two-wheeler sales dipped by 5 percent, passenger vehicles (PV) by 11 percent and commercial vehicles (CV) by 14 percent, showed the data.
However, on a month-on-month basis, the overall sales were up by 5 percent as June 2019 had the 2nd lowest volume base this CY after February.
Postponement of demand seen in June due to deficient rainfall concluded in July, even spread of monsoon, and slight liquidity improvement seen towards July end in the banking system also contributed to uptick in sales.
“With June being a completely dry and rain deficient month, consumer sentiment was at its lowest and with July rains covering up a lot of the deficit, some confidence in consumer demand led to pending purchase conclusion in July. Despite these factors, CV sales continued to be in the negative even MoM," said F A D A President Ashish Harsharaj Kale.
PV inventory levels have reduced further, coming closer to FADA’s proposed 21 days inventory. However, CV inventory continued to be at high levels, said the statement released by FADA.
An extremely slight reduction was seen in two-wheeler inventory levels, which continue to remain at very high levels and a serious cause of concern for dealers, said FADA.
However, the national automobile body remains positive on the near-term outlook for the sector.
"Hon'ble finance minister meeting with the auto industry, followed by immediate action on the retail lending push for banks and NBFC, a point strongly advocated by FADA and a strong positive statement from Hon. Prime Minister on the auto industry and indication of stimulus for demand generation and growth revival of the economy coupled with a revival of the monsoon builds positive hope amongst dealer for the festive season, despite the current lack of demand and weak consumer sentiment," it added.
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