With the semiconductor shortage easing a bit, the wholesale despatches of passenger vehicles (PVs) in May improved over the same month in 2019, which was a non-Covid year. However, sales were still lower than the level achieved in 2018 when the segment was witnessing a handsome growth. The two-wheeler wholesale despatches during the month were not only far off from the volumes achieved three years ago, they were even below the figures attained nine years back.
The wholesale despatches of PVs jumped 10.61% to 251,052 units in May from 226,975 units during the same month in 2019, data released by Society of Indian Automobile Manufacturers (Siam) on Friday showed. In May 2018, PV volumes stood at 301,238 units.
While there is still uncertainty over when the supply of semiconductors will normalise, the demand for PVs remains very high. Some of the popular models, particularly SUVs, have waiting periods running into months.Relatively higher ownership costs, especially in the entry-level segment, continued to impact the demand for two-wheelers with their wholesale despatches in May plunging 27.36% to 1.25 million units. The semiconductor shortage has hurt the sales of the premium motorcycles as well. Similar to two-wheelers, the three-wheeler volumes dipped 44.74% to 28,542 units.The total wholesale despatches, including that of PVs, two-wheelers and three-wheelers, fell 23.52% to 1.5 million units.
“Sales of two-wheelers and three-wheelers continue to remain sluggish in the month of May 2022, as they are even below what it was 9 years and 14 years ago, respectively. Sales of PVs are also still below 2018 level,” said Rajesh Menon, director general, Siam.
Menon noted that the recent government interventions would help in easing the supply-side challenges but the second hike in repo-rate by the Reserve Bank of India (RBI) and an increase in third-party insurance rates could become more challenging for the customers, thereby impacting demand.