Automakers who were worried about getting sales back on track were surprised by June auto sales as demand outstripped supply.
Stock has been reduced by one lakh units and bookings were made for over two lakh vehicles in June, as people are shifting towards personal mobility in the wake of COVID-19.
June auto sales saw 1.7 lakh passenger vehicles retailed by manufacturers. However, despatches were only 1.16 lakh units, highlighting production issues that manufacturers currently face.
Every day throws a new curveball like COVID-19 lockdown, workforce shortage, supply line disruption, among others.
Vehicle makers are looking to boost production by 30 percent in July to meet demand that is evident from June auto sales.
With nearly 25 percent sales lost due to continuous lockdowns this year, automakers do not want to miss such an opportunity to boost sales.
Passenger vehicle production is expected to touch close to 1.7 lakh units this month, to reduce the shortage that is estimated to be around 40 percent at present.
Country’s top automaker Maruti Suzuki witnessed bookings reach 85 percent to pre-COVID levels. But less than 50 percent vehicles were delivered.
To meet demand, Hyundai Motor India and Toyota began operating two shifts at their factories.
One interesting development witnessed in June is that the enquiry to retail sales cycle has come down. While earlier it used to be 15-20 days, now it is in single digits, state automakers.
The current demand is due to people choosing personal transport as opposed to public transport over fears of contracting COVID-19.
But a long-term demand will depend on the revival of the economy. In FY20, auto sales was down 18 percent, the worst in two decades.
June Auto Sales
- June auto sales shows production issues faced by manufacturers
- Out of 1.7 lakh vehicles retailed, only 1.16 lakh were delivered in June
- Production to increase by 30 percent in July to meet demand
Source – ETAuto.com