Auto Retail Sales Rise 21.83% YoY To 25.57 Lakh Units In June; EVs, CNG And Hybrids Cross 40% Share: FADA

New Delhi, Jul 6 (KNN) India's automobile market recorded its best-ever June, with alternative fuel vehicles — CNG, hybrids and electric vehicles combined — accounting for a record 40.4 per cent of all passenger vehicle retail sales, as rising petrol and diesel prices prompted consumers to rethink their purchasing decisions, according to data released by the Federation of Automobile Dealers Associations (FADA).

Overall vehicle registrations rose 21.8 per cent year-on-year (YoY) in June to 2.6 million units, the highest-ever June sales recorded by FADA, while retail passenger vehicle sales climbed 28.6 per cent to 410,853 units.

Fuel Price Impact

India raised petrol and diesel prices multiple times in May after crude oil prices surged amid the Iran-Israel conflict, forcing oil marketing companies to pass on higher import costs to consumers. 

The increase widened the running-cost advantage of CNG, hybrid and electric vehicles, making them increasingly attractive despite their relatively higher upfront prices. 

CNG-powered vehicles accounted for 24.3 per cent of passenger vehicle sales in June, hybrids for 8.3 per cent, and battery electric vehicles for 7.8 per cent, with the combined alternative-fuel share crossing 40 per cent for the first time.

Category-Wise Performance

FADA President C S Vigneshwar said the industry retailed 2,557,234 units in June, up 21.83 per cent YoY, with passenger vehicles, two-wheelers, three-wheelers, commercial vehicles and tractors all posting their highest-ever June figures. 

Passenger vehicle retails grew 28.63 per cent YoY, with rural demand at 35.09 per cent outpacing urban at 24.67 per cent, though rural sales slipped 0.11 per cent month-on-month against urban's 3.54 per cent rise, reflecting a monsoon-linked pause. Passenger vehicle EV retails touched 31,823 units, an all-time high, he noted.

Two-wheeler retails stood at 1,828,458 units, up 21.22 per cent YoY, with two-wheeler EV share crossing double digits for the first time at 10.60 per cent, against 7.34 per cent a year earlier. 

Commercial vehicle retails rose 16.88 per cent YoY to 90,972 units, with rural demand at 21.63 per cent outpacing urban at 12.75 per cent, while three-wheelers grew 16.20 per cent with EV penetration at 64.08 per cent. Tractor retails rose 25.31 per cent YoY to 100,818 units, their second-best June on record. 

Total EV retails across all categories reached 306,220 units, the highest for any month, taking overall EV penetration to about 12.5 per cent.

Vigneshwar noted that passenger vehicle inventory rose by one day over May-end to 32-34 days, further from FADA's recommended 21-day benchmark, and urged original equipment manufacturers to calibrate dispatches to retail through the monsoon-soft July window.

Outlook

For July, 51.24 per cent of dealers surveyed by FADA expect growth, 41.79 per cent anticipate a flat market, and 6.97 per cent foresee a decline, with expectations resting on the monsoon making up its deficit and supplies staying normalised following the West Asia ceasefire. 

For the July-September quarter, dealer confidence is stronger, with 66.17 per cent expecting growth and 38.31 per cent having revised their FY27 retail outlook upward. Dealers identified a monsoon shortfall as the single biggest risk to the outlook, followed by further price hikes affecting affordability.

(KNN Bureau)