After two-month slide, auto industry steadies for festive jumpstart

Domestic passenger vehicle sales increased about 1% in July, marking a slight recovery after two consecutive months of decline, amid persistently sluggish consumer demand. Companies are cautiously optimistic that sales will accelerate further during the coming festive season, starting with Onam later this month. As many as 348,000 cars, sedans, and utility vehicles were dispatched from factories to dealerships last month, compared with 344,000 vehicles in July 2024, according to industry estimates. Retail sales were flat at about 328,000 vehicles last month.

At the country’s largest carmaker Maruti Suzuki, wholesale volumes were largely unchanged at 137,776 vehicles last month. Partho Banerjee, senior executive officer (marketing and sales) said while Maruti has seen an uptick in bookings ahead of the festive season, starting with Onam in Kerala, conversions are slow.

“Growth in rural markets which stood at about 10% last year, has now come down to 2-3%. In urban areas, with layoffs in the IT sector, buyers are cautious,” Banerjee said, adding, “We have, however, seen an increase in bookings which is a positive sign.”

“With the advent of the festive season, as things stabilise, we expect the demand momentum to pick up,” said Banerjee.

Maruti Suzuki has so far recorded a 10% increase in bookings in Kerala. Korean rival Hyundai Motor India too saw sales dip by 10% to 43,973 vehicles in July. Tarun Garg, chief operating officer, said, “While the overall auto industry has seen some softness in recent months, we remain optimistic with the onset of the festive season and are fully geared up with robust supply and product offerings.”