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Passenger Vehicle Sales Fall 3% in May as Two-Wheeler Demand Climbs

Elevated inventory levels alongside tight financing have slowed entry-level car sales, prompting a cautiously optimistic outlook for June

Photo: ANI
Cars Parked In A Showroom
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Overview

  • Passenger vehicle retail registrations fell 3% year-on-year to 302,214 units in May as consumers in border regions delayed purchases over India-Pakistan tensions.
  • Two-wheeler retail sales rose 7% to 1.65 million units, driven by rural demand, auspicious marriage dates, and pre-monsoon buying.
  • Dealers faced inventory levels of 52–53 days of supply, more than double FADA’s 21-day benchmark.
  • Electric vehicles accounted for over 4% of passenger vehicle sales in May, marking a first-time milestone for the segment.
  • The Federation of Automobile Dealers Associations predicts a cautious June recovery supported by monsoon-linked rural spending and potential Reserve Bank of India rate cuts.