Lowest vehicle registration/sales in 8 years forces FADA to appeal for government aid

FADA is hopeful of good sales in June as the rains are being predicted from the first day of the month, thereby uplifting the buying sentiments.

By:May 10, 2021 11:36 AM
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The Federation of Automobile Dealers Association or FADA as it is called has announced the per month vehicle registration data for FY20-21. These numbers aren’t very promising for the industry as it shows a steady decline as far as car registrations are concerned. While the year on year bit isn’t something that can be compared as in April 2020, no vehicle sales happened, FADA says that they have compared April 2021 sales numbers and these aren’t good as well. Compared to March 2021, the sales fell down by 28 per cent. This, as Vinkesh Gulati the FADA president says, could be down due to the partial or complete lockdown imposed on many states in India. Tractors were the highest hit with as much as 45 per cent lower sales compared to last month. Incidentally, the tractor category grew by as much as 16 per cent in FY20-21.

On a MoM basis, all vehicle categories closed the month in red with two-wheelers down by 28 per cent, three-wheelers by 43 per cent, passenger vehicles by 25 per cent, and CVs by 24 per cent. Last year, FADA says, moratorium and EMIs being deferred were announced. However, since this time the state governments have imposed restrictions on movement, banks aren’t coming forward with any relief package. In this case, FADA appeals to the central government that it should direct the RBI to come up with loan relaxation for the re-payment equivalent to the tune of number of days of lockdown each state has announced.

FADA also requests the manufacturer OEMs to not burden their dealers with over inventory. It is requesting the dealerships to handhold their employees during this tough time. FADA predicts a sluggish May as the first few days of the month have shown a lean sales number. FADA is hopeful of good sales in June as the monsoons are being predicted from the first day of the month. This in turn will lead to good farming opportunities and hence additional purchase of vehicles. FADA claims that two-wheelers as well as tractor sales can help bring in some momentum.

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