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TVS Motor Company and Hero Motocorp beat domestic sales in February 2024 as shortages of chip supply got eased.
The industry body of automobile dealers said, in India, retail sales of vehicles leaped 16% to around 1.8 million units in February 2024, which was helped by strong demand during the wedding season. They also added that festivals in March 2024, will push the sales higher.
The sales got higher in the last two months as the automakers launched new models which resulted in higher demand ahead of the festivals and wedding seasons. As chip shortages also got eased, it can be one of the reasons why sales got into demand.
The rising interest rates and elevated inflation was also seen as perspective .overall, the sales in February 2024 are still below pre covid level.
According to The Federation of Automobile Dealers Association (FADA), the sales of two-wheelers advanced by 15%, three-wheelers by 81%, passenger vehicles by 11%, tractors by 14%, and commercial vehicles by 17% in a statement.
FADA added that, from April 2024, there would be changes in emission norms, where vehicle prices will increase and automakers will proclaim promotional offers in the final month of the fiscal year.
The Industry body cited a bunch of festivals that will create higher sales in March 2024, which includes a two-day festival of colors- Holi and regional new year celebrations Gudi Padwa and Ugadi.
FADA publishes retail sales data and the Society of Indian Automobile Manufacturers ( SIAM) usually releases data in the second week of the month, which also counts the number of vehicles that are sold to dealers.
Auto sales numbers carry more than 50% of weightage by calculating India’s economic growth and it is one of the key indicators to access private consumption.
El Nino weather conditions in the Pacific may result in higher prices and lower input, which is not good for commercial sales in India, it also means that it will create a weaker monsoon in the country.
FADA also said that after government subsidies transgressed pre-pandemic levels for the first time, the three-wheeler segment continued to witness healthy demand in February 2024.
Significant challenges during the COVID-19 pandemic.
TVS Motor Company, which is one of the leading two-wheeler manufacturers in India, faced significant challenges during the pandemic. The company had to temporarily suspend production at its plants in India in compliance with the government’s lockdown measures to control the spread of the virus. As a result, the company’s sales were severely impacted during the first quarter of the financial year 2020-21.
However, the company quickly adapted to the new normal and resumed operations at its plants in a phased manner with strict safety measures in place. TVS Motor also introduced a range of digital initiatives to provide customers with a seamless buying experience, including an online booking and virtual showroom platform.
Despite the challenging environment, TVS Motor managed to deliver a strong performance in the second half of the year, with sales recovering to pre-pandemic levels. The company reported a revenue of INR 20,745 crores (USD 2.8 billion) for the financial year 2020-21, a decline of 6% from the previous year.
Hero MotoCorp, the world’s largest two-wheeler manufacturer, faced significant challenges during the pandemic. The company had to temporarily halt production at its plants in India in compliance with the government’s lockdown measures, which impacted its sales during the first quarter of the financial year 2020-21.
Hero MotoCorp also had to deal with supply chain disruptions and logistical challenges due to the pandemic. However, the company quickly resumed operations at its plants with safety measures in place and introduced a range of digital initiatives to connect with customers.
Despite the challenging environment, Hero MotoCorp managed to deliver a strong performance in the second half of the year, with sales recovering to pre-pandemic levels. The company reported a revenue of INR 29,280 crores (USD 4 billion) for the financial year 2020-21, a decline of 7% from the previous year.
Overall, both TVS Motor Company and Hero MotoCorp demonstrated resilience and agility during the pandemic, adapting quickly to the new normal and focusing on customer needs.
