India’s automobile sector witnessed a strong uptick in sales during October 2024, with two-wheeler sales rising by 14.2% year-on-year and passenger vehicles (PVs) reaching their highest-ever monthly sales. The figures, released by the Society of Indian Automobile Manufacturers (SIAM), reflect the post-festival consumer demand and the country’s recovering rural economy.
Two-wheeler sales soared to 21.64 lakh units in October 2024, compared to 18.96 lakh units in October 2023. This represents a robust 14.2% growth, making it a significant highlight for the industry. Experts attribute this surge to a combination of festive demand, a favorable monsoon season, and a boost in rural incomes, all of which have played a key role in driving higher consumer spending.
Rajesh Menon, Director General of SIAM, noted that the simultaneous occurrence of Dussehra and Diwali in October 2024 created a favorable environment for sales growth. “These festivals traditionally lead to higher consumer demand, which significantly boosted the auto industry’s performance,” Menon said.
Passenger vehicle sales also saw a notable rise in October, reaching an all-time high of 3.93 lakh units. While this growth was modest at 0.9% compared to last year, it came on top of an already strong base from October 2023. This increase in passenger vehicle demand highlights the continued resilience of the Indian automobile market despite global economic challenges.
According to SIAM, the surge in registrations for both passenger vehicles and two-wheelers was particularly visible in the Vahan vehicle registration data, which showed over 30% growth in October 2024 compared to the same month last year.
Despite the overall positive growth in vehicle sales, three-wheeler sales witnessed a slight dip of 0.7%, totaling 0.77 lakh units in October 2024. However, a significant 11% growth in three-wheeler registrations was recorded, suggesting a shift in the market dynamics, possibly influenced by evolving urban mobility patterns.
The surge in two-wheeler sales, in particular, is attributed to the recovery in rural incomes, thanks to favorable agricultural conditions this year. A normal monsoon season led to better crop yields, which translated into higher incomes for rural households. Additionally, the government’s increase in the minimum support price (MSP) for several crops further boosted farmers’ earnings, enabling increased spending on consumer goods, including vehicles.
This uptick in rural consumption is also evident in other sectors of the economy. According to a NielsenIQ survey, rural demand for fast-moving consumer goods (FMCG) grew at a faster rate than urban markets in the July-September 2024 quarter. FMCG sales in rural areas rose by 5.7% in value and 4.1% in volume, marking the third consecutive quarter of rural growth outpacing urban consumption.
The October 2024 surge in both two-wheeler and passenger vehicle sales signals a positive outlook for the Indian automobile market, bolstered by favorable economic conditions and festive demand. While three-wheelers saw a slight decline, the overall performance of the sector reflects a strong recovery, particularly in rural areas where higher incomes are driving consumption. As the country continues to recover from global economic challenges, the automotive sector remains a key beneficiary of this growth.
