Sales of private vehicles declined by 19.2 per cent in the fourth quarter of 2021-22.
New Delhi:
Government data shows that sales of private vehicles declined during the fourth quarter of FY 2021-22 (FY22). According to the Gross Domestic Product (GDP) estimates for Q4 FY22 released on Tuesday, sales of private vehicles declined by 19.2 per cent as against a growth of 27.1 per cent in the same period of FY11.
The sharp drop in sales comes on the heels of a global semiconductor shortage – leading to long waiting periods for cars. Higher fuel prices, rising costs for manufacturers and geopolitical tensions also hit demand.
The waiting period of various models has increased by more than 2 years. For example, you will have to wait 90 weeks for the top-end Mahindra XUV 700, while 44 weeks for the Thar.
According to car dealers, the demand for vehicles increased after the pandemic, but the supply could not keep up. Global semiconductor shortages keep vehicle supplies restricted, as chips are a key component in car models. According to Mahindra dealers, there are about 84 chips in an XUV700, which makes semiconductors vital to car manufacturing.
“On one hand, there is a demand for certain models, categories which are premium type products. But on the other hand, when we talk of entry-level segment, customers are not there to buy. We have a long waiting list cms -Conductor issues, container issues and for the premium vehicles and compact SUV segment due to China’s COVID restrictions. Production is still not normal. We have seen some good months – in April and March – but from April onwards, the same issue is there,” Vinkesh Gulati, President, Federation of Automobile Dealers Association (FADA) said ndtv,
He further added, “Entry-level segment is badly affected” as “such customers are still under pressure post-Covid things. Fuel prices and material cost have increased. For the last two years, entry-level vehicles The acquisition price has gone up by around 20-25 per cent, which is a huge jump for a person who wants to buy a car for Rs 4 lakh.”
Mr Gulati said Russia-Ukraine conflict and external global issues have also affected sales.
He expressed hope that by the month of October – which is the start of the festive season – “there will be enough production and the supply chain will become regular.”
On the reduction in waiting periods – which has climbed to around 2 years for some cars, Mr Gulati said “it will improve” but “predicting whether it will be greatly reduced, I am still skeptical as they Vehicles are where every customer is interested.”
He also said that “the rate at which we add vehicles every month has come down a bit”.