1. GST steals festive thunder of car sales

GST steals festive thunder of car sales

As customers made most of discounts offered pre-GST, sales sluggish at Ganesh Chaturthi.

Mumbai | Published: August 27, 2017 5:50 AM
A salesman makes a sales pitch at a car showroom.

Despite the onset of the festival season, which kickstarts with Ganesh Chaturthi, retail sales of passenger vehicles remain sluggish. Dealers in Mumbai peg this to advance purchases by consumers in June, when companies offered huge discounts to clear inventories before the rollout of GST from July 1. A Honda showroom sales executive told FE, “Usually, sales are high in the run up to Ganesh Chaturthi as we see around 12-13 bookings a day at our dealership, but we saw a reverse trend this time with hardly two-three bookings a day.” Also, while it may seem that normalcy in currency circulation has been restored in the country after demonetisation, the auto industry is still grappling with its after effects. “Demonetisation is still affecting our sales after the government wiped away unaccounted money from the country,” admitted a Hyundai showroom sales manager. However, dealers are expecting a resurgence in sales in October, before Diwali. “Shraadh, which begins on September 5, is considered inauspicious and we are not expecting sales to rise in that period. We only expect a pick up around Diwali, which is in October,” said a Maruti Suzuki dealer. However, wholesale volumes have been very strong for car manufacturers, as they increased dispatches to car dealers, who started re-stocking from July. In the same month, passenger vehicle makers recorded a sharp 15% jump in volumes year-on-year. Passenger car wholesale volumes rose by 8.5% to 1,92,773 units.

By Deepak Kumar

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