Semi conductor shortage puts spoke in car sales wheel in December 2021

With semi-conductor shortage continuing to play spoil-sport, passenger vehicle sales, in spite of huge bookings in December, closed in the red. Dealers, however, saw slight ease in vehicle supply thus giving some hope of improvement, stated the Federation of Automobile Dealers Association (FADA) while releasing its monthly sales data.

Commenting on the December 2021 performance, FADA President Vinkesh Gulati said, “The month of December is usually seen as a high sales month where OEMs continue to offer best discounts to clear the inventory due to change of year. It was, however, not the case this time around as retail sales continued to disappoint thus wrapping up an underperforming calendar year.”

As mentioned in its earlier press release, FADA again noted that India is once again under the grip of Covid with Delta/Omicron affecting people at an ultra-fast pace. This has also ignited the 3rd wave, it said.

Various state governments have once again announced covid restrictions. Work and education from home have resumed and will have a negative effect for auto retail. With the fear of health care expenses rising again, the customers are shying away from closing their purchase decisions, FADA pointed out.

With IIT Kanpur predicting the peak of omicron sometimes in 1stweek of February, FADA hence remains extremely cautious over the next 2-3 months.

Source: FADA Research

Disclaimer:

The above numbers do not have figures from AP, MP, LD &TSas they are not yet on Vahan 4.

Vehicle Retail Data has been collated as on 03.01.22in collaboration with Ministry of Road Transport & Highways, Government of India and has been gathered from 1,379 out of 1,590 RTOs.

Source: FADA Research