India's automobile production and sales increased in August, supported by the festival season and increased availability of vehicles.
Sales rose by 18pc on the year to 1.88mn units, while production climbed by 14pc against the previous year to 2.27mn units, according to the Society of Indian Automobile Manufacturers (Siam).
April-August sales rose by 33pc on the year to 8.29mn units, with passenger vehicle sales increasing by 30pc on the year to 1.49mn and two-wheeler sales rising by 33pc to 6.66mn units, according to Siam. Production during the same period rose by 23pc on the year to 10.5mn units.
India celebrated the Raksha Bandhan and Ganesh Chaturthi festivals in August.
Good monsoon and the upcoming festival season is likely to increase demand, although higher compressed natural gas prices will act as a headwind for the sector, Siam director general Rajesh Menon said.
Total auto sales by dealers across the country rose by more than 8pc on the year to 1.52mn units in August, India's Federation of Automobile Dealers Associations (Fada) data show.
Total vehicle retail sales continued to remain low compared with pre-Covid levels in 2019, although increased availability of vehicles with easing of semi-conductor supply issues and the festivals of Onam and Navratri in September are expected to boost sales, as per Fada.
But heavy rainfall and floods in several states and the 15-day period of Shraadh that is considered inauspicious to purchase new vehicles this month will keep automobile demand in check, according to Fada.
The Indian steel industry sees 8-10pc of its demand from the automobile sector. Lower steel prices since the imposition of the export tax has supported automobile production.
