Strong Wholesales on Low Base of Previous Year

 

Dear dealer colleagues,

The 286th council meeting of your Federation was held on 15th December 2017 along with second edition of ‘Vyapar’ in the financial capital of the country, Mumbai. This time, apart from the Council Members, newly appointed State Chairpersons were specially invited to voice their local concerns. This is in line towards building F A D A a single point of contact for dealers in Automobile Retail Industry across the length and breadth of the country. You would be happy to know that we are reigniting F A D A Academy and Mr C S Vigneshwar, Anamallais Agencies, Coimbatore has been appointed as its Director. The F A D A Academy programs will prepare current and future dealer leadership to build front end and back end processes, improve customer and technical operations and enhance financial results of each department of the dealership. To begin with, the academy will conduct 12 Knowledge Sessions across the country in the next calendar year.

Vehicle ownership in India, which is estimated at 28 per 1,000 at the end of FY17, is near an inflection point, similar to that seen in markets such as China, South Korea, and Japan in the past. Rapid growth in vehicle ownership in these countries was supported by greater-than-8% growth in GDP, close to what we are seeing in India now. Thus, it is believed that India’s passenger vehicle (PV) market is in the midst of a structural growth cycle and is likely to see a 12-14% CAGR over the next 5-10 years, underpinned by 6-7% annual growth in GDP. Two-wheeler growth is likely to stay around a 10% CAGR, given higher ownership levels. However, scooter growth could be much stronger at ~15-20% driven by rural preferences and a growing number of working women. M&HCV growth is likely to remain strong (15% YoY in FY19) due to the enforcement of overloading restrictions and improving industrial activity.

For the month of November, PV segment sales grew the fastest since July on the back of a low base effect caused due to last year’s demonetization exercise. Total passenger vehicle sales grew 14.29% to 2.75 lakh units during the month, helped by a 44.6% rise in utility vehicle sales. Dispatches in the passenger car segment, however, increased by just 4.4% to 1.81 lakh units.

Reverting to initiatives of F A D A, I am happy to inform that the Federation along with its State Chapters have been sending GST Representations at both Central and State level to make its voice heard. In fact, we are now being called by various ministries which are keen to speak to us and understand our point of view. This shows that we are on the right path and I hope that sooner or later we will be able resolve our GST issues.

Regarding recent guidelines by IRDAI on motor vehicle insurance, F A D A has been looking at various options. I must assure that we will leave no stone unturned to resolve the concerns of dealer fraternity.

For the first time, F A D A in association with SIAM is organising Dealer’s Day on 8th Feb’18 exclusively for dealers on the first day of Auto Expo. It will be a huge occasion to meet respective OEMs and discuss Auto Retail’s way forward. In line of Auto Expo, F A D A has been organizing its biennial event “Auto Summit”. The forthcoming one on 9th Feb’18 will be the 10th Summit and this time we will make it even larger with more than 1000 participants attending the same. The industry is now entering the next orbit of development, where one will witness several groundbreaking technologies driven by regulatory initiatives and standards. The fact that the future of automobile industry belongs to autonomous and e-mobility, this Summit’s theme has been aptly selected as CONTROL OUR DESTINY. Along with the Summit, we are also organizing F A D A Awards, powered by Autocar Professional. This is India’s only platform which recognizes and rewards the excellence in automotive retail. You are hence requested to kindly nominate your dealership for this prestigious award as the last date for nominations is not far away. 

Seeing the huge response and interest expressed by dealer fraternity, F A D A is taking a delegation of 50 plus dealers to attend NADA 2018 Convention from 22-25 Mar’18 in Las Vegas. I strongly recommend that you attend the same and witness how the future of auto retail is shaping up. For more details, please get in touch with F A D A Secretariat at This email address is being protected from spambots. You need JavaScript enabled to view it.

By the time this issue reaches you, we will be embracing the year end festivities. I hope that this new year brings in best of times for all of us at the Automobile Retail Industry.

With best wishes for the new year,

Yours sincerely

 

John K Paul

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