Rs 73,000 Crore Worth Of Unsold Cars At Dealerships In India - Attractive Discounts Incoming?

As per a report by FADA (Federation of Automobile Dealers Associations), the apex body of India’s automotive retail industry, there’s Rs 73,000 crore worth of stock of unsold cars at dealerships all over India, which translates to over 7 lakh unsold cars. SIAM argues that these numbers are inflated and the actual numbers are somewhere close to 4 lakh units. Read ahead to know more.

Reduce Outflow Of Vehicles To Dealers - FADA

FADA claims that the unsold inventory is more than double of what the ideal stock should be. This in turn puts a heavy burden on dealers all over the country. Thus, FADA demands a reduction in the outflow of vehicles from OEMs to dealers. 

Car Companies To Take Corrective Action - SIAM

SIAM, the Society of Indian Automobile Manufacturers, argues that FADA has over reported these numbers and the actual numbers are close to half of those reported by FADA. They also asked the dealers not to worry too much about the unsold stock and affirmed that the respective companies where the stock level is higher than what is ideal will take corrective action. 

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Total Car Sales In July 2024 In India Up By 10%

The passenger vehicles sales in India in July 2024 stood at 3,20,129 units, which was a 10% increase, as reported by FADA. On the other hand, the number of vehicles dispatched by OEMs to dealers stood at 3.41 lakh units, which indicated a 2.5% decrease when compared to the same month last year. It is noteworthy that this was due to a high base effect, which means that the wholesale figures of last year were higher than usual, which in turn makes this year's figure look lower while it actually isn’t in absolute terms.

Amongst the slowdown in demand in the first quarter of 2024-25, Maruti Suzuki India Limited has adjusted its production in order to manage high dealer inventory numbers. 

Should We Expect Heavy Discounts And Offers For New Car Buyers In India Soon?

The problem isn’t just limited to certain manufacturers, but most of the automakers are currently facing difficulties in clearing their unsold stock, including India’s best-selling manufacturers such as Maruti Suzuki and Hyundai. Due to the slowdown in demand for specific models and high inventory numbers, buyers may soon see heavy discounts being offered on certain brands and models ahead of this festive season.

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