November auto retail sales hit a record high of 28.54 lakh vehicles across categories, surpassing the previous high of 25.69 lakh vehicles achieved in March 2020, during the auto industry’s transition from BS-4 to BS-6 emission norms, the Federation of Automobile Dealers’ Associations (FADA) said on Wednesday.

Two-wheeler and passenger vehicle (PV) sales hit new all-time highs, with two-wheeler (2W) sales at 22.47 lakh units, against the previous high of 20.7 lakh units in March 2020, and PV sales at 3.6 lakh vehicles, surpassing October 2022 sales of 3.57 lakh vehicles.

Two-wheeler sales grew by 21 per cent year-on-year (YoY) as compared with 18,56,108 units in November last year, while PV sales spiked 17.19 per cent YoY as compared with 3,07,550 units in the corresponding month last year.

Three-wheeler (3W) sales also grew by 23.31 per cent YoY to 99,890 units during the month, as against 81,007 units in November 2022.

However, commercial vehicle (CV) retail sales declined by around two per cent YoY to 84,586 units in November, as compared with 86,150 units in the same month last year.

Tractor sales also declined by more than 21 per cent YoY to 61,969 units last month, as compared with 78,720 units in November 2022.

November 2023 witnessed a strong surge in the PV category, primarily fuelled by Diwali and the launch of new and appealing models. Improved supply chains coupled with new launches effectively catered to the festive demand, marking the peak point in sales. However, the period following the festivities saw a noticeable slowdown, coupled with a critical challenge of slow-moving inventory due to a mismatch in demand and supply,” said Manish Raj Singhania, President, FADA.

This issue casts a shadow over otherwise positive trends, highlighting the need for strategic adjustments in inventory management, he said.

Singhania said the 2W category is poised to benefit from a liquidity boost, particularly in agricultural regions and the ongoing marriage season, with around 38 lakh marriages expected to drive vehicle sales.

“However, challenges persist as severe weather conditions impacting rabi cultivation might affect rural incomes, potentially dampening sales. In contrast, the CV category is expected to see a recovery, driven by renewed business activities post-elections and positive movements in key sectors such as cement and coal. Backlogs in orders might also contribute to a sales boost,” he added.