Pending vehicle registrations from pre-lockdown time continue

Even as automakers reported zero domestic sales in the month of April for the first time in history due to the coronavirus-induced lockdown, data shows that passenger vehicle registrations continued throughout the lockdown time. But, this does not signify a revival in consumer demand. A majority of these registrations trace back to the pending books made just before the lockdown which are now getting registered and executed due to the easing of the lockdown norms.

According to a report by Morgan Stanley on Friday, which cited Vaahan vehicle registration as the source, the week corresponding to May 22, 2020 saw 11,132 PV registrations, the highest number ever since the enforcement of the lockdown. The May 15 week saw 5,698 PV registrations. Similarly, there were 2,340 PV registrations in the May 8 week, 3,864 in the April 24 week, 93 in the April 17 week, 186 in the April 10 week and 9,436 registrations in the April 3 week.

“These are pending bookings because the lockdown was announced very abruptly on March 24. So the majority of these are booked vehicles. New sales have also started but it’s negligible as of now, (though) more bookings have started,” Ashish Kale, president, Federation of Automobile Dealers’ Association (FADA), told BusinessLine, when asked about the data.

“As more categories of economic activity were gradually permitted after the third and fourth phases of lockdown, there was an uptick in the number of vehicle registrations. Unfortunately, this may not be attributed directly to demand revival but rather on clearing pending registrations as the lockdown was quite sudden,” affirmed Suraj Ghosh, Principal Analyst, Powertrain & Compliance Forecasts, IHS Markit.

Nonetheless, there were few launches prior to the pandemic which garnered huge response and high bookings, Ghosh noted. “And now that few carmakers have started partial manufacturing, the orders are being fulfilled and hence we expect registrations to improve in the coming weeks,” he added.

“Additionally, we must note that not 100 per cent of RTOs in the country are under Vaahan coverage and the updating cycles of RTOs may not be in sync or real-time,” said Ghosh.

Bookings have started particularly in states which have opened up earlier, like Kerala, Karnataka, Orissa and Goa, Kale pointed out. “We are assuming and hoping that if the lockdown doesn’t get extended, then the retail sales will start from the first week of June onwards,” he said.