2W registrations up by 11%, passenger vehicles declines 3% in December 2018: FADA

Inventory in PV reduced by immediate steps of moderation in dealer supplies by OEM's

The Federation of Automobile Dealers Associations (FADA) today released the Monthly Vehicle Registration Data for the month of December 2018. The two-wheelers (2W) registration were up by +11% to 11.41 lakh, while passenger vehicles (PV) registration were down by -3% to 2.03 lakh in December 2018 over December 2018. For the current financial year up to 31 December 2018, 2W registration were up by +5% to 110.71 lakh, while PV registration declined 2% to 19.18 lakh.

Commenting on the December numbers, FADA President, Ashish Harsharaj Kale said, "We are seeing initial signs of revival in the industry as compared to the recent festival season. Passenger vehicle sales arrest further de-growth as good retail momentum in last 15 days indicates sentiment turning positive. 2W shows positive growth on a YoY basis although MoM trend shows decline."

Post festive season, Fuel Prices have reduced to its lowest levels in the last 3 months. Although Liquidity continued to be a major constraint in December, a number of initiatives seem to be on the table of our policy makers towards easing the overall situation, positive effects of which will be felt in this quarter. The NBFC Liquidity, which directly impacts the Auto Industry is also getting due attention and we are hopeful that positive measures will be taken in the meeting of the RBI Governor with all the NBFC's today, further helping in improving the consumer sentiment.

FADA appreciates the efforts taken by our OEMs to correct the Extremely High Dealer Inventory post the festival season, especially OEM's of Passenger Vehicles. Moderation in wholesale billing in the month of December and some reasonably good retail sales, towards the month end, has definitely helped in reducing the extremely high PV inventory, to reasonable levels in many markets. Continued efforts in the right direction by all OEMs in the PV segment will surely bring down the Inventory levels to normal across all geographies by January end.

CV inventory reduced slightly in December but continues to be above normal. Continuation of the efforts, as taken in December by CV OEMs of calibrated dealer billing, coupled with continued strong retails, will ensure return to normal dealer stock levels in January.

The inventory of 2W dealers still continues to be very high, while FADA hopes that similar positive steps, as taken by the PV OEMs, are being taken by the 2W OEMs and inventory would moderate. According to a survey conducted by FADA among its members, the current inventory of PVs ranges from 35-40 days, 2W ranges from 55-60 days and CV ranges from 35-40 days.

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