Passenger vehicle: PV sales remain subdued in January due to chip supply constraints

Sales of passenger vehicles remained subdued in January due to supply constraints brought about by a global chip shortage, even as order bookings remained strong amid robust demand.

As per data available with industry body Society of Indian Automobile Manufacturers (SIAM) as many as 254,287 passenger vehicles were sold in the local market last month. This is a decline of 8% compared to 276,554 units sold in the year-ago period.

The sales decline is lower at around 3% if we were to include to the volumes of Tata Motors which has stopped reporting sales data on a monthly basis to SIAM.

Automakers in India report wholesale dispatches from factories to dealers and not retail sales to customers.

In the two-wheeler segment weak consumer sentiments in rural markets dragged down volumes at the entry-level. Overall, two-wheeler sales last month decreased 21% to 1,128,293 units.

Rajesh Menon, Director General, SIAM said, “Sales in the month of January 2022 again declined compared to January 2021, due to both Omicron related concerns and semi-conductor shortages. There is clearly a demand issue for two-wheelers due to lower rural off-take of entry level models.”

Sales of three-wheelers in the month under review fell 10% to 24,091 units.

“Three-wheelers continue to be severely affected due to lower sales. On the other hand, passenger vehicle segment is unable meet the market demand due to supply side challenges resulting sales in January 2022 being even lower than January 2021”, added Menon.

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