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India’s low auto sales and production momentum in April interrupted the growth recovery witnessed in December and March quarter, owing to the second COVID-19 wave, according to India Ratings and Research’s (Ind-Ra) April auto report.

  

Several OEM’s have temporarily ceased production due to shortage of semiconductors, surge in COVID-19 cases, strict lockdown in major states and scarcity of oxygen which is now being diverted for medical needs. Owing to these challenges, several manufacturers have advanced their scheduled June maintenance period to May. Furthermore, lockdown has dulled consumer sentiments. Dealerships are shut for almost a month in key cities, which is hurting auto sales.  

 

Sales

In April, auto sales in India tumbled 30pc compared to previous month, comparison to prior year is not comparable as sales in April 2020 were almost nil. Ind-Ra stated that the main reason for sales drop in April compared to March was the increase in COVID-19 cases which resulted in state-wise lockdowns, particularly in the second half of the month.  

 

However, export volumes continue to improve, up 19pc in April, driven by a surge of 21pc in two-wheeler growth compared to March levels, stated Ind-Ra. 

 

The report said that demand for personal vehicles was resilient in April, reporting the least decline compared to other segments owing to preference for personal vehicles during the pandemic. 

 

Motorcycle sales fell 34pc and non-gear bike sales was down 33pc in April from the prior month. Ind-Ra noted that two-wheeler is a price sensitive segment. A hike in prices announced by manufacturers on the back of surging commodity prices, coupled with the petrol prices reaching all-time high in India, resulted in sluggish sales of two-wheelers. 

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