Electric vehicles account for 8% sales of total vehicle sales in May: FADA
PUNE: After a sluggish start in the financial year, the auto retail sales have rebounded in May, thanks to the surge in sales of electric vehicles or EVs.
While the total retail sales posted a 10 per cent year-on-year growth, EVs made impressive strides last month, contributing to 8 per cent of the total vehicle retail, the Federation of Automobile Dealers Association said on Monday.
“May showcased an increased penetration of EVs, accounting for 8 per cent of total sales, with 2-wheelers contributing 7 per cent, 3-wheelers contributing 56 per cent, commercial vehicles contributing 0.5 per cent and passenger vehicles contributing 2.5 per cent respectively,” said FADA President Manish Raj Singhania.
He said two-wheelers, three-wheelers, passenger vehicles, and commercial vehicles grew by 9 per cent, 79 per cent, 4 per cent, and 7 per cent, respectively last month.
Singhania, said the 2-wheeler sales were positively influenced by seasonal factors like the marriage season, changes in the FAME subsidies effective from June, and the recovery of rural demand, which hint towards a promising future in the aftermath of the COVID-19 pandemic.
In the passenger vehicle segment, the improved availability of vehicles, the strength of pending orders, and the robust demand for new launches drove a positive momentum, helping the segment rebound after a slump in the previous month, FADA said.
The commercial vehicle segment, the barometer of the economy, experienced sustained growth, underpinned by the government's focus on infrastructure development.
The bus segment too displayed a notable increase, driven by improved financing options and higher sales in academic institutions, FADA data showed.
“In the near term, however, the auto retail sector faces diverse challenges across the 2W, CV and PV segments,” Singhania pointed out.
For 2W, seasonal factors could boost demand, but concerns like weather-induced walk-in reductions, inventory, and regulatory norms persist, he said.
The CV sector anticipates improved vehicle availability but concerns about RDE norms and seasonal effects may impact sales.
The PV sector expects increased demand, particularly for new models, compact and full-sized SUVs and EVs, but inventory pressure and right model availability could pose challenges, Singhania said.