Post-festive auto sales have not been as negative as anticipated with pent-up demand playing a good part, but extended and steady demand in the auto market will rely on the economy and developments about COVID-19 vaccine, according to a senior official of India’s biggest auto maker Maruti Suzuki India.
“The auto industry was expecting a large decline in consumer interest in terms of bookings and inquiries. Although there has been a decline, it is marginal and certainly not as much as the expectations or the fear that was in the industry,” Maruti Suzuki India Executive Director (Marketing and Sales) Shashank Srivastava told reporters in an interaction on Wednesday.
He added that in that sense it is a substantially far more good situation post-festival than was earlier anticipated. Going by the present trends of booking and inquiries and low stock levels at the dealers and makers, December must be fine, Srivastava stated.
According to the Federation of Automobile Dealers Associations, passenger automobile retail sales in November witnessed a year-on-year rise of 4.17 per cent to 2,91,001 units as Diwali-Dhanteras period led to rise in automobile registrations, compared with 2,79,365 units in November 2019.
When asked about the road ahead, Srivastava stated, “There has been an element of pent-up demand so far. We really don’t know when will it drain out.” Therefore, he added, the fresh demand, extended and steady demand in the auto market depends fully on the fundamentals of the economy. “There is a very high correlation between auto demand and per-capita growth.” He stated it will also rely on the sentiment surrounding the COVID-19 pandemic.
“On those two factors, there is still some sort of uncertainty although we are hearing positive noises on both fronts as well,” he stated. Those have been the primary factors “why manufacturers are little apprehensive about giving forward guidance for the next quarter and beyond”, Srivastava added.