India's passenger vehicle sales dip by 9% in August
What's the story
India's passenger vehicle sales witnessed a significant dip of 8.8% in August, according to the Society of Indian Automobile Manufacturers (SIAM). The total number of units sold stood at 321,840 as opposed to last year's figure of 352,921. The drop is largely due to automakers adjusting their dispatch schedules and consumers postponing purchases. Expectations of a possible GST reduction last month further dampened booking momentum across multiple vehicle segments.
Market performance
Growth in 3-wheeler and 2-wheeler segments
Despite the drop in passenger vehicle sales, the three-wheeler and two-wheeler segments witnessed a surge. The former recorded its highest-ever August sales at 76,000 units, marking an impressive growth of 8.3% year-on-year. The two-wheeler segment also grew by 7.1%, with total sales reaching 1.83 million units during the same period.
Future prospects
GST reduction impact on automotive sector
Rajesh Menon, the Director General of SIAM, highlighted the impact of the Indian government's decision to reduce Goods and Services Tax (GST) rates on vehicles. He said this landmark decision would enable broader access to mobility, thereby injecting fresh momentum into the Indian automotive sector in the upcoming festive season. GST on smaller cars (under 1,200cc) has been cut from 28% to 18%. For bigger vehicles, GST is now a flat 40%, down from up to 50%.