Flood, landslides may impact auto sales in select areas in coming months: FADA

After three consecutive months of growth, India’s auto retail sector applied the brakes in July, with overall retails declining by 4.31 per cent year-on-year
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JOTHI RAMALINGAM B

While the monsoon outlook through August-September appears broadly supportive, the localised flood and landslides in select areas may hamper automobile sales in the coming months, Federation of Automobile Dealers Associations (FADA), said on Thursday.

Also, external headwinds have emerged as the US administration’s imposition of an additional 25 per cent tariff on Indian exports has precipitated a 0.4 per cent dip in benchmark equity indices and a depreciation of the rupee, injecting volatility into financial markets, the auto retail sector body said.

“The resulting wealth erosion and import‐cost pressures on exporters could erode consumer confidence, trigger a precautionary rise in household savings and exert downward pressure on discretionary spending — including on vehicles — over the near term,” C S Vigneshwar, President, FADA said, while sharing the monthly sales data.

By harnessing precision-targeted promotions, partnership-driven finance solutions and dynamic rural–urban engagement, the industry can navigate these headwinds and anchor itself on a trajectory of sustained retail growth, he said.

“We enter August with a sense of guarded optimism, confident in the upside but ever mindful of the risks,” he added. In the monthly retail sales data, FADA reported the passenger vehicle (PV) segment declined by around 1 per cent to 3,28,613 units in July as compared with 3,31,280 units in July last year. In the two-wheeler (2W) space, July saw a 6.48 per cent decline to 13,55,504 units as compared with 14,49,487 units in July last year.

In the three-wheeler (3W) segment, the retail segment grew by around 1 per cent to 1,11,426 units in July as compared with 1,10,511 units in the corresponding month last year.

The commercial vehicle (CV) segment also grew marginally (0.23 per cent ) during the month to 76,439 units as against 76,261 units in July 2024.

Tractor sales grew by 11 per cent YoY to 88,722 units in July as compared with 79,961 units in the same month last year.

In total, the sales across categories declined by 4.31 per cent to 19,64,213 units in July as compared with 20,52,759 units in July last year.

“After three consecutive months of growth, India’s auto retail sector applied the brakes in July, with overall retails declining by 4.31 per cent y-o-y,” Vigneshwar said. This pullback largely stems from a high-base effect in July 2024, when an extreme heat wave was immediately followed by excessive rainfall, constraining volumes before a rebound later that month, he added.

Published on August 7, 2025