India auto sales soar 20% in September ahead of festive seasons
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Demand is expected to slowdown in the coming months, however.
During Sep-16, domestic sales of passenger vehicles rose 20% YoY and two wheelers grew 22% YoY, ahead of Diwali and Dussera in Oct-16.
MayBank KimEng’s channel checks suggest the demand for automobiles is 10% more than in the previous two festive seasons.
“We expect demand to normalize lower in Nov and Dec as dealers start cutting inventories,” it said in a report.
The Society of Indian Automobile Manufacturers (SIAM) confirmed the uptrend by revising up its sales growth forecast to 10-12% for FY17 from 6-8%.
“We will wait for two more months of retail sales data before deciding whether to revise up our growth forecasts,” said MayBank KimEng.
Questions & Answers
Q.Why is demand expected to slow down in the coming months?
Why is demand expected to slow down in the coming months?
Demand is expected to normalise lower in November and December. This is because dealers will start cutting their inventories following the festive season, leading to reduced sales.
Q.What percentage increase did MayBank KimEng note in automobile demand compared to previous festive seasons?
What percentage increase did MayBank KimEng note in automobile demand compared to previous festive seasons?
MayBank KimEng's channel checks suggest that the demand for automobiles was 10% more than in the previous two festive seasons. This indicates a significant jump in consumer interest during the current period.
Q.Has the Society of Indian Automobile Manufacturers (SIAM) changed its sales growth forecast for FY17?
Has the Society of Indian Automobile Manufacturers (SIAM) changed its sales growth forecast for FY17?
Yes, SIAM has revised its sales growth forecast for FY17 upwards. The new forecast is 10-12%, an increase from their previous prediction of 6-8%, confirming the positive market trend.
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