FADA (Federation of Automobile Dealers Associations) released the February 2019 Vehicle Registrations statistics today. Please note that these are the vehicle registration data (delivery of Invoiced vehicles from dealers to end customers) and clearly indicates the vehicle sales movement. Otherwise we have always been tracking the vehicle offtake data (billing of vehicles from OEM to authorized dealers). FADA releases number based on VAHAN data which covers about 75 per cent of nation’s RTO. As usual; we thank FADA for publishing the retail data and providing much realistic data about the actual sales of vehicles.
As seen above; majority categories (PVs, 2Ws & 3Ws) saw a massive decline in registrations. The sole exception was CV segment which posted a growth of 4.92%. The total sales for the Industry touched 14,52,078 units and the overall automotive industry registered a YoY de-growth of -8.06 percent!
With slowing retails; Dealers are facing over-stocking issues and the Inventory levels have shot over the roof. Basis dealer fraternity feedback; PV dealers are carrying stocks upto 60 days and 2-Wheeler dealers are stocking upto 3 months Inventory! The scenario is pushing both OEM and dealers to continue offering excessive discounts and liquidate the stock. The condition is going to worsen ahead – with a deadline of ensuring no BS4 inventory is left till April 2020; OEMs and dealership are bound to go under the panic mode.
Tough times ahead for Passenger Vehicle OEMs & Dealers. While OEMs will have to scale up investment to meet the upcoming emission and safety norms; Dealers will have to ensure that the stock vehicles are moved out as soon as possible. Maruti has already announced that it shall have its entire portfolio of cars BS6 ready by end of December 2019. New Entrants like Kia & MG are already planning to bring BS6 cars since day 1.