Registration of vehicles across India fell 88.9 percent year-on-year in May as the COVID-19 lockdown remained in place across large parts of the country, the Federation of Automobile Dealers Associations (FADA) said.
On a YoY basis, all vehicle categories register unprecedented de-growth: registration in the two-wheeler fell by 88.8 percent, three-wheeler by 96.34 percent, commercial vehicles by 96.63 percent, passenger vehicles by 86.97 percent and tractors by 75.58 percent, respectively.
“For the first time in history, the month of April witnessed zero retails. While the lockdown was gradually relaxed beginning May, auto dealerships and workshops opened for the first time after 40 days in many cities. At the end of May, out of 26,500 outlets, about 60 percent showrooms and 80 percent workshops were operational across the country," FADA President Ashish Harsharaj Kale said.
"May registrations are hence not indicative of the demand situation as the lockdown still continued in many parts," he added.
The first 10 days of June witnessed extremely low demand despite most dealerships being open for business, the FADA President said.
"Weak consumer confidence, especially in urban areas, continues to haunt as customers stay away from concluding their purchase due to threat of community spread and return of complete lockdown persists," he added.
With an assumption of no further lockdown and continued reopening measures, FADA expects to see a substantial pick-up in auto retail in comparison to May but the overall outlook continues to be grim with projected sales to witness a de-growth upwards of 25 percent YoY.
FADA said that with a projected annual de-growth of 35 percent by SIAM on top of the 18 percent de-growth faced last year, the dealership community faces its toughest years ever as volumes are estimated to half in a span of 20 months."With no direct support as business community, except for the moratorium extension given to all businesses, the dealership community looks forward to an early recognition as an MSME to avail Government support for the survival and for its 40 lakh workforce," the FADA chief said.