Demand for new vehicles up, as used car market see drop in prices: Report

While new passenger vehicle sales witnessed a 9 per cent rise in July sales compared to last year, the used car market seems to be seeing a dip in demand as prices saw a decline ranging from 6 per cent to 10 per cent in eight of the ten top-selling models, data shared by Shriram Mobility Bulletin for July.

While the price of Maruti Swift and Maruti Ertiga (with an average age of five years) declined by 10 per cent in July compared to the same month in 2023, Mahindra Bolero saw a 6 per cent increase. Maruti Baleno, Tata Nexon, and Maruti Dzire were also down by 7 per cent. Other brands like Hyundai Creta, Maruti Brezza, and Mahindra Scorpio too saw a 6 per cent decline in rates during the period under review. Among the top ten selling brands, other than Bolero, only WagonR saw a marginal increase of 1 per cent during the period.

Interestingly, this comes at a time when two-wheeler sales were seen increasing in new vehicles and the used vehicle category. Two-wheeler sales posted a 17 per cent increase year-on-year. The only two-wheelers that saw a dip in the top five among the used vehicle category were Honda Shine and Bajaj Pulsar with a 3 per cent and 2 per cent dip respectively in July.

"Two-wheeler sales, which form the backbone for rural transportation, are expected to do well. Two-wheeler sales in the D2D (Dussera to Dhanteras) may be in the region of 54 lakh to 55 lakh units, up from nearly 45 lakh last year," said YS Chakravarti, managing director and chief executive officer of Shriram Finance Ltd.

On the other hand, truck rentals across key trunk routes saw a positive trend in July, expecting a higher festive demand in commercial hubs. Among the routes, the Kolkata-Guwahati-Kolkata route saw a 3.9 per cent increase in trip rentals compared to June this year.

"With the kharif harvest around the corner and copious water stored in reservoirs due to good monsoon rains, rural activity will gain momentum in the coming months. Manufacturers too are ramping up supplies to commercial hubs in anticipation of higher festive offtake across product categories. We are witnessing sentiment turning positive," he added.

In the month of July, consumption of petrol remained static on a month-on-month basis and increased by 10 per cent on a yearly basis. Diesel consumption dipped by 10 per cent compared to June this year and increased by 4 per cent compared to July last year. Intra-state and inter-state E-Way Bill generation, the number of suppliers, and E-Way Bill value increased by 17 per cent, 9 per cent, and 12 per cent respectively, compared to the same month last year.