Two-wheeler sales in all States and Union Territories (UTs) have registered negative growth in June 2020
Even with relaxations announced after the lockdown, things are a long way from becoming normal. Vehicle registration data published by the Federation of Automobile Dealers Associations (FADA) shows that a total of 7,90,118 two-wheelers were sold across the country in June 2020. YoY growth has fallen by -40.92%, as compared to 13,37,462 units sold in June last year.
Uttar Pradesh continues to top the list
Among all states, maximum number of two-wheelers were sold in India’s most populous state Uttar Pradesh. A total of 1,34,402 units were sold in June 2020. Sales have almost halved, as compared to 2,55,796 units sold in June last year. Tamil Nadu takes the second place with sales of 97,381 units in June 2020. Sales growth has dropped -21.73% in comparison to 1,24,412 units sold in June last year. At number three is Bihar with 83,816 units sold in June 2020. Sales are down -27.10%, as compared to 1,14,967 units sold in June last year.
Other states in the top 10 list are Karnataka (72,890 units), Rajasthan (45,871), Maharashtra (41,698), Gujarat (41,209), Kerala (37,759), Odisha (37,072), and West Bengal (33,616).
States with highest de-growth
In the top ten, max de-growth in two-wheeler sales in June has been registered by Maharashtra (-64.78%). West Bengal is next with -52.00% de-growth, followed by Gujarat at -49.90%. Among all states, Ladakh, Manipur and J & K have registered max de-growth at -100.00%, -99.78% and -84.48%, respectively.
FADA reports that two-wheeler sales are expected to grow further in the coming months, even though achieving pre-Covid level growth might still take several months. Most dealerships are now operational across the country and customers are also choosing online purchase and home delivery options launched by two-wheeler manufacturers.
A notable finding by FADA is that consumer sentiment in rural areas continues to be buoyant. The harvest was good last year and monsoon season has arrived early this year. Moreover, the weatherman has predicted that it will be a normal monsoon this year across most parts of the country. With ample cash at their disposal, consumers in rural areas are driving demand for two-wheelers.
The situation in Tier-I cities is just the opposite, where people are having to deal with mini-lockdowns imposed by respective state governments. This is pulling down the local economy, resulting in weak consumer confidence.
Other problems listed by FADA include challenges on the supply side and constraints in issuing two-wheeler loans by NBFCs. FADA has urged the government to announce favourable policy decisions for the auto industry, so that return to normalcy can be achieved in the shortest possible time.