Auto sales declined by 16 per cent in December 2021: FADA

Auto sales across dealer outlets in India declined by 16.05 per cent year-on-year to 15,58,756 vehicles in December 2021 against 18,56,869 units sold in December 2020, according to figures released by the Federation of Automobile Dealers Associations (FADA). 

Sales of four-wheeled passenger vehicle in December declined by 10.91 per cent to 2,44,639 units in December 2021, from 2,74,605 units in December 2020. This drop in sales is majorly caused by a shortase in the supply of semiconductor chips needed for auto manufacturing, even as demand remained robust. 
FADA also noted that the financial implications of Covid-19 had a dampening effect on the demand for two-wheelers in India. A total of  11,48,732 two-wheelers were sold in the country in December 2021 against 14,33,334 units sold in December 2020 - a 19.86 per cent decline. The dealer association sees a further decline in two-wheeler sales in January 2022 because of the resurgence of Covid cases and subsequent travel restrictions. 
"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. With semi-conductor shortage continuing to play spoil-sport, PV sales in spite of huge bookings, in December closed in red. Dealers, however, saw slight ease in vehicle supply thus giving some hope of improvement." Vinkesh Gulati, president, FADA, said.
The Indian automobile market has been grappling with sales downturn ever since the onslaught of  the Wuhan virus in 2019 and later by the impending transition to BS6 norms followed by a shortage of semiconductor chips. Demand for vehicles continues to remain depressed even as we have entered 2022.