You must have come across news of several car makers offering mouth-watering discounts on their vehicles in the past few weeks. That's because car dealers are sitting with nearly 7 lakh units of unsold inventory as the overall demand for passenger cars among retail buyers has slowed down.
The recent data released by the industry body SIAM reveals total wholesales of 3,57,757 units in June 2024, which is a hike of 3 percent over June 2023. However, the retail sales in the same period were 2,81,566 units. There is an unsold inventory of more than 70,000 units in just a month. The overall unsold inventory at this time is nearly 7 lakh units, which explains the rising discounts on several cars.
Vinod Aggarwal, SIAM President, said to NDTV Auto, "While passenger and commercial vehicles have witnessed moderate growth, two-wheelers and three-wheelers have posted very handsome growth in double digits." He did not comment on the inventory issue.
The SIAM numbers also reveal the rising popularity of the SUV body style, which now accounts for more than 60 percent of total sales. SUV wholesales were 6,45,794 units, which is a rise of 18 percent compared to last year. Hatchback and sedan sales dwindled significantly with 3,41,293 units, a drop of 17.5 percent.
Currently, a total of 14 hatchbacks and sedans are on sale in India, with a majority of them coming from brands like Maruti Suzuki, Hyundai, and Tata Motors. Brands like Honda, Renault, Volkswagen, and Skoda also offer either a sedan or a hatchback in addition to their SUV offerings.