India’s retail vehicle market kicked off 2024 with a robust 17.61% year-on-year growth, reaching 2,722,558 units in January. This impressive surge was primarily fueled by strong demand for two-wheelers and passenger vehicles, as reported by the Federation of Automobile Dealers Associations (FADA) on Tuesday.
Passenger vehicle sales climbed 7.22% to 513,475 units, with urban markets accounting for 59.2% of the total volume. However, the real story unfolded in rural areas, where retail sales of passenger vehicles jumped 14.43% year-on-year, outpacing urban growth of just 2.75%. This rural momentum underscores a shifting dynamic in India’s auto sector.
FADA President C S Vigneshwar attributed the trend to favorable factors like GST reductions, post-harvest cash flows, and the wedding season. ‘Dealers are reporting heightened inquiries for high-value models, supported by strong liquidity in rural pockets,’ he noted. Festivals such as Pongal and Makar Sankranti further boosted sentiment.
Two-wheelers led the charge with 1,852,870 units sold, marking a 20.82% increase. Rural regions contributed nearly 56% of these sales. Commercial vehicles weren’t far behind, rising 15.07% to 107,486 units, including 65,505 light commercial vehicles and 34,287 heavy ones—both segments up around 14%.
Looking ahead, FADA’s outlook remains optimistic for February, backed by positive macroeconomic indicators and dealer confidence. An overwhelming 72.56% of dealers anticipate growth, with only 4.51% expecting a dip. This resilience signals a healthy trajectory for India’s automobile industry amid economic recovery.