Adequate rainfall across the country along with the start of the long festive season will keep the demand for automobiles positive and help keep the momentum going, rating agency CareEdge said in a report on Tuesday.
It said that new model launches by the automakers along with some improvement in the availability of semiconductors helped sustain the demand for automobiles in July.
On a year-on-year basis, the domestic sales vehicles' growth stood at 11 per cent, with 2.9 per cent growth on a month-on-month basis.
With the upcoming festive season, the automakers are focusing on building up inventory in anticipation of higher demand, the report said.
The domestic sales in the two-wheeler segment registered a growth of 5.5 per cent on a monthly basis in July 2022, with the scooters subsegment growing strongly by 14 per cent while the motorcycles sub-segment grew marginally by 2 per cent.
"Normal monsoons in most parts of the country resulting in a decent agricultural harvest kept the demand sentiment positive."
Coming to exports, shipments for two-wheelers fell 9.6 per cent on a monthly basis with declining export sales of 15 per cent motorcycles sub-segment as the international markets were facing some headwinds due to rising inflation, geopolitical tensions, and adverse economic conditions in Sri Lanka and Nepal.
The passenger vehicle segment domestic sales showed an improvement in sales of 6.3 per cent on in July.
"The OEMs (original equipment manufacturers) are continuously launching new models, especially in the compact SUV segment which will further help to sustain the demand in the festive season. With the improving availability of semiconductor chips, there is an expectation of a lower waiting period in the coming months," the report said.
However, the third hike in repo rates by the Reserve Bank of India to restrain high inflation will make auto loans costlier.
"This (lending rate hike) may restrict the growth, especially in entry-level vehicle segments which have price-sensitive customers," it further said.
( With inputs from ANI )
Disclaimer: This post has been auto-published from an agency feed without any modifications to the text and has not been reviewed by an editor