Two-wheeler industry to grow by 8%, tractors by 4% annually: Report

The two-wheeler (2W) industry is projected to grow by 8% YoY from January to July 2024, driven by strong rural demand and sustained urban sales, according to a Nuvama report. The favourable monsoon has enhanced rural sentiment, leading to increased sales. At the same time, wholesale volumes are expected to exceed retail sales as dealers build inventory for the festive season. The tractor industry is also anticipated to see marginal growth of approximately 4% YoY, supported by improved farmer sentiment due to normal monsoon conditions and favourable terms of trade, where output inflation surpasses input inflation.

Conversely, the Passenger Vehicle (PV) segment will likely experience a slight decline in sales by around 3% YoY, impacted by the high base effect from last year’s early festive season. The Commercial Vehicle (CV) sector is expected to face a minor contraction of about 4% in annual growth due to a high base effect for cargo vehicles, despite positive indicators such as increased e-way bill generation and better freight availability. The report notes that August 2024 volumes will show mixed results across the automotive industry, with growth in the 2W and tractor segments, while PV and CV segments face challenges. Notably, India's automobile exports reached 4,500,492 vehicles in 2023-24, 76.8% being 2-wheelers. The country aims to double its auto industry size to US$ 178.70 billion (Rs. 15 lakh crore) by the end of 2024.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.