With six months of 2025 gone, automotive dealers are scouting for customers to offload unsold stock of vehicles manufactured in 2024. The rising inventories have compelled companies to dole out high discounts. However, last year’s stock is becoming less attractive for consumers since they are getting discounts even for models produced in 2025.
Estimates shared by carmakers and dealers peg the unsold stock at around 50,000 units valued at close to `5,500 crore. The inventory comprises mainly premium, slow-moving models–both electric and non-electric–across brands.
The industry is saddled with a total stock around 600,000 units, which is equivalent to two months of retail sales volumes. Of this, around 6-10% is estimated to have been produced in 2024.
Hyundai is offering a discount of Rs 4 lakh on the 2024-made, all-electric Ioniq 5, while the Sport version of the Volkswagen Taigun can be bought at a discount of Rs 2.05 lakh. Tata Motors is giving away cars at discounts ranging from Rs 70,000 to Rs 1 lakh on the 2024 stock of Tiago Ev, Punch EV and Curvv EV.
Mahindra & Mahindra (M&M) has offers running on the Scorpio N, XUV3XO, XUV700, XUV400 ranging from Rs 55,000 to Rs 4.1 lakh, all of which were built in 2024.
Renault, Nissan, Jeep, Citroen and Skoda also have 2024 stock in their inventory, including Triber, Kiger, Meridian, Basalt, Kushaq on which there is a minimum discount of Rs 1 lakh.
CS Vigneshwar, president of the Federation of Automobile Dealers Association (FADA), told FE that original equipment manufacturers (OEMs) are “dumping” vehicles. “The reason some vehicles are not selling not that dealers cannot sell them but because demand is lukewarm. Most of these vehicles are dumped because the colour is not right or the variant is not popular,” he said.
At times, manufacturers have despatched 2024 models after 3-4 months into the new year. “This happens because of bad production planning,” said a dealer from south India.
Passenger vehicle volumes are expected to decrease marginally in June owing to muted customer sentiments, as indicated by lower enquiries and delays in conversion.
“Discounts (overall) have increased year-on-year for Hyundai, M&M and Tata Motors (TML) though they are lower for Maruti Suzuki (MSIL). We reckon Hyundai volumes shall fall 6% to 61,000 units, MSIL by 5% to 171,000 units and TML by 5% to 41,600 units,” analysts at Nuvama wrote.
The car industry is staring at continued sluggishness in retail demand in the coming weeks which would increase the pressure on its channel partners. However, with supplies from manufacturers expected to be lower, in the wake of supply chain issues such as permanent magnets, dealers may stock up on some in-demand models.
“There would be certain dealers who would want to build up on stock. But most wouldn’t because this would come back and bite them in case the supply chain issue eases out. We don’t think this issue would last for long. We have not met too many dealers who wish to ass stock aggressively at this stage,” Vigneshwar added.