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Overall auto industry has de-grown; pent-up demand not able to cover losses due to lockdown: FADA

Updated : April 08, 2021 11:57 AM IST

Vehicle registration data for March shows that auto registrations continue to fall by almost 28.6 percent as compared to last year. However, there has been a 10 percent growth month-on-month (MoM). Several dealers of passenger vehicles have also reported loss in sales due to supply side constraints.

Speaking to CNBC-TV18, Vinkesh Gulati, President of Federation of Automobile Dealers Associations (FADA) said that lockdown impact was different for different segments, but the overall industry has seen a decline in growth.

Also Read: Auto retail sales in March fall by 28.64% YoY: FADA

“March last year was a mixed bag. We had seen BS-IV, BS-VI transition happening and even the lockdown happening in the last 7 days. So, it is different for different categories. BS-IV, BS-VI transition for passenger vehicle had been better. So we are seeing a good growth if we compare year-on-year (YoY). So passenger vehicle has grown by 28.39 percent and it is seeing green trajectory for the past 4-5 months and we are expecting this to continue. But all the other categories have not grown. So, overall industry has de-grown around 28 percent. So even post-COVID the recovery is still not been able to come to pre-COVID level,” he said.

He also said that annual sales in the auto sector has not improved and that the pent-up demand is not able to cover the loss due to lockdown.

“If you look at the last year COVID lockdown, the annual sales have not recovered. We are still double digit minus. No doubt the pent up demand helps us, but it cannot cover to the original sales. It cannot be 100 percent back to what we expect to be. So, if April is closed, whatever pent up demand we are able to cover up in May and June, it will not cover 100 percent numbers of April,” he said.

Also Read: COVID curbs: FADA requests Maha govt to allow dealerships to open with 50% manpower

Gulati further noted that the entry level two wheelers are still under pressure due to job losses during the COVID lockdown.

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