Pranav Shah, chairman of FADA – Gujarat, said, "The decline in sales took place due to several reasons. Heavy rainfall in the Saurashtra and South Gujarat regions of the state adversely affected retail sales. Many dealerships also suffered waterlogging. Meanwhile, the onset of the shradh period in Sep was also a major deterrent to sales, as it is considered inauspicious for new purchases. Gujaratis typically do not buy anything new or sign new contracts during this period."
"Festivals in Aug and Oct have contributed to the decline in sales in Sep. Independence Day, Janmashtami and Raksha Bandhan were major factors that boosted sales in Aug," Shah added.
The rates of decline in car and two-wheeler sales in Gujarat are steeper than that across India. While two-wheeler sales declined by 8.5% across the country, car sales went down by 18.81% during the period. Discounts and offers have been introduced across segments to stimulate demand, but these have yet to translate into an improvement in sales.
A senior RTO official also explained how the shradh period has affected the sale of cars and two-wheelers.
"Several car and two-wheeler buyers made bookings in advance for Oct purchases, whereas others bought vehicles in Aug itself, avoiding the inauspicious period. Due to this, new vehicle registrations have been relatively few during the month," the official explained.
According to FADA officials, high inventory levels in the passenger vehicle segment present a risk if Oct sales do not meet expectations and it could put pressure on dealers and manufacturers.
Heavy discounts and offers might impact dealer profitability if sales do not pick up during the festive period.
"Seasonal factors like the shradh period and heavy rainfall further affected demand for two-wheelers, resulting in delayed purchases and a subdued market environment," according to FADA officials.
During this time, the demand for commercial vehicles remained sluggish due to several factors, including reduced govt expenditure, prolonged monsoon delays and seasonal obstacles.
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