The Federation of Automobile Dealers Association (FADA) has red-flagged the rising inventory levels in the sales channels urging original equipment manufacturers to not only moderate vehicle dispatches but to also introduce more aggressive and attractive schemes.

Passenger vehicle inventory levels have soared to an all-time high of 63-66 days with dealerships signalling capacity concerns, said the association in its sales data release for October 2023. A twin strategy of moderating wholesale dispatches and announcing discounts is essential to help dealers clear their inventory before year-end, averting the potential financial repercussions associated with excess unsold stock, said the association.

According to FADA, the auto retail sector saw an 8 per cent year-on-year decline.

However, a month-on-month comparison reveals a 13 per cent surge, indicative of resilient market demand. With ongoing festivities, all automotive categories posted growth.

Two-wheelers grew 15 per cent, three-wheelers 2 per cent, passenger vehicles 7 per cent, tractors 15 per cent and commercial vehicles grew 10 per cent on a MoM basis.