(Reuters) -Indian automakers’ car sales to dealers slid to an 18-month low in June, data from an industry body showed on Tuesday, amid weak demand in urban areas.
Urban Indians have tightened discretionary spending for a better part of this year, with wage hikes lagging the growth seen in previous years.
Car makers delivered 312,849 units to dealers last month, the Society of Indian Automobile Manufacturers said in a statement, down 7.4% from 337,757 units a year before.
For the June quarter, car sales to dealers slipped 1.4% to a two-year low. On a quarter-on-quarter basis, sales were down 13%, compared with a 9.6% drop in the same period last year.
Sales of cars to dealers usually decline between the March and June quarters as manufacturers generally prop up sales with discounts in the first three months of the year to clear excess inventory.
Car sales hit record highs for three consecutive financial years in the world’s third-largest car market, before losing steam in 2024-25 amid a fall in disposable income.
Sales grew by a mere 2% in the financial year to March 2025 after rising 8.7% in fiscal 2024 and 27% in fiscal 2023.
Industry insiders expect overall car sales in India to grow just 1%-2% in the year to March 2026, citing flailing demand.
Last week, a dealers’ body said challenges in securing rare-earth materials “have stalled component production, further constraining supply and retail volumes.”
“Overall sentiments across categories have remained subdued so far, even as the industry continues to navigate supply-side challenges,” SIAM President Shailesh Chandra said.
Automakers are counting on festive demand and lower loan rates to help sales recover.
(Reporting by Nandan Mandayam in Bengaluru; Editing by Subhranshu Sahu)
