India sees 9.1% growth in automobile sales in 2024 with growth in most sectors

Retail automobile sales in India are set to grow by 9.1 per cent to 26.1 million units in 2024, overcoming several hurdles like extreme weather, elections and uneven monsoon.

Segment-wise, two-wheeler sales registered a growth of 10.7 per cent, three-wheelers 10.4 per cent, passenger vehicles 5.1 per cent and tractors 2.5 per cent, according to the data released by the Motor Vehicle, while commercial vehicle sales remained almost stable at 0.07 per cent. doing. Federation of Automobile Dealers Association (FADA).

Three-wheeler, passenger vehicle and tractor segments hit new all-time highs; Two-wheelers have almost crossed their 2018 peak and commercial vehicles have still not crossed their 2018 levels.

Challenges for two-wheelers with internal combustion engines include finance constraints and increasing competition from electric vehicles, the industry body said in a statement on Tuesday. Commercial vehicles are struggling with election-induced uncertainty and low core spending; Margins were under pressure due to higher inventories and discounts due to passenger vehicle growth.

In the last month of December, 2024, total retail automobile sales declined by 12.4 per cent, which included two-wheelers (-17.6 per cent), three-wheelers (-4.5 per cent), PVs (-1.9 per cent) and CVs (-1.9 per cent). (-5.2 percent) is facing decline. In December, tractor sales alone witnessed a year-on-year jump of 25.7 percent.

In the near term, FADA claims around 48 per cent automobile dealers expect growth in January, 41.22 per cent expect flat sales and 10.69 per cent expect a slowdown.

Improvement in MSP and rural liquidity may benefit two-wheeler demand, although financing and electric vehicle transition remain key challenges.

FADA said new launches, wedding-season demand and promotions should boost passenger vehicles volumes, but potential price hikes could weigh on profits.

In the longer term, considering the entire year 2025, 66 per cent of dealers expect growth, 26.72 per cent expect stagnation and only 6.87 per cent expect a recession.

“Overall, FADA is optimistic that market recovery, coupled with strategic OEM support and policy-level clarity, will enable the automotive retail industry to end 2025 on a strong note,” the statement said.