Automobile retail sales in the country dropped 8 per cent on an annual basis in July because of a fall in registrations of cars, two-wheelers and tractors. The industry is concerned any China-Taiwan conflict could disrupt chip supplies.

Data released by FADA showed passenger vehicle retail sales fell 5 per cent to 2.5 lakh units in July against 2.6 lakh units sold a year ago. Overall retail sales stood at 14.3 lakh units in July against 15.5 lakh units a year ago.

Data divide However, the data released by car manufacturers showed sales in July rising 16 per cent to 3.4 lakh units from 2.95 lakh sales a year ago. The numbers by auto makers are based on supply to dealers and do not truly reflect the market picture.

Aumobile dealers’ body FADA’s numbers are based on off take by actual customers. In the past, there have been allegations of manufacturers dumping inventory on car dealers to shore up their market share. The dealers in anticipation of demand could also build inventory. The launch of models increases inventory at dealers which may not result in actual sales for the month.