India Car Sales Jump 92% On Pent-Up Demand Ahead Of Holidays
While demand was strong in cities, vehicles remain unaffordable to many in India, with automakers passing on higher input costs.
(Bloomberg) -- Sales of cars and SUVs in India soared 92% in September from a year earlier, driven by demand in major cities ahead of the festival season as pandemic restrictions eased.
Data from the Society of Indian Automobile Manufacturers showed sales of passenger vehicles totaled 307,389 last month, compared with 160,212 in September 2021. Car sales climbed 122% to 142,727 units, while SUVs rose 73% to 151,759. Van sales totaled 12,903.
“A combination of good urban demand and pent-up demand is reflected in the sales,” SIAM Director General Rajesh Menon said in New Delhi on Thursday.
The Federation of Automobile Dealers Associations of India said earlier in October that passenger vehicle sales could be the highest in a decade this festive period. Diwali will fall on Oct. 24.
The big jump in sales came from a low base, given the Covid situation in India a year ago, SIAM President Vinod Aggarwal said. “That is why we see better growth rates.”
While demand was strong in cities, vehicles remain unaffordable to many in India, particularly now that automakers are passing on higher input costs to consumers. About 65% of India’s population lives in rural areas.
“Interest rates are going up, compressed natural gas prices are increasing, inflation is also high,” Aggarwal said. “There is pain in entry-level segment. Costs have significantly gone up.”
Sales of scooters, a preferred mode of transport in much of India, increased 13% to 1.74 million from a year earlier.
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