Automobile dealers are celebrating record vehicle sales in October this year when reforms, festivities, and pickup in rural sentiments all came together to boost demand.
Overall retail sales of vehicles grew YoY by a robust 40.5 per cent, driven by strong purchases of both passenger cars and two-wheelers. “After an almost quiet September for first 21 days due to the GST 2.0 transition, October witnessed a swift rebound with, pent-up demand spilling over to positive festive sentiment and tax-cut excitement,” according to the automobile retailers.
They said that, showrooms witnessed stronger footfalls during the month. Among vehicles, sales of scooters & bikes surged 52% YoY, cars by 11% YoY, commercial vehicles 18 per cent, while sales of three-wheelers and tractors increased by 5 per cent and 14 per cent respectively.
Auto retailers pointed out that, the implementation of GST 2.0, played a major role in increasing sales of small-cars as it made vehicle ownership more attainable, especially for the cost-sensitive first time buyer. Further, standout sales was from rural markets where favourable monsoons, higher farm incomes, and government infrastructure push drove the purchasing power.
Rural car sales grew three times faster than urban, while rural 2W sales was nearly double vis-à-vis urban markets. “The 42-day festive period of Dussera- Diwali, coupled with GST rate cuts delivered the highest-ever sales and growth across categories,” said the Federation of Automobile Dealers Associations (FADA), president C S Vigneshwar.
He said that, compact cars and sub-4metre SUVs saw strong sales as they benefitted the most from reduced tax rates. “The near-term outlook for vehicle sales looks positive as it is supported by a confluence of encouraging macro and policy factors. The GST reforms continue to drive affordability, especially in the mass and entry-level segments. Strong rural cash flows post-harvest, marriage season demand, and improved stock availability across categories are expected to sustain retail momentum,” said the president of the retailer association,”pointed out Vigneshwar.
Upcoming new model launches, healthier financing conditions, and stable fuel prices will further reinforce a supportive ecosystem for the automobile market. A dealer survey indicates that the industry expects the momentum from the festive surge to extend into November. Car dealers are reporting a strong pipeline of undelivered festive bookings, better stock availability, and continued traction from the GST price reduction.
Total 5.6 lakh cars and 31.5 lakh two wheelers sold in October this year as compared to 5 lakh and 20.8 lakh cars and two wheelers respectively in October 2024.
