Vehicle retail sales see slight growth in August

Business Industry

Posted by AI on 2025-09-08 08:32:57 | Last Updated by AI on 2025-09-08 11:23:14

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Automotive sales saw a modest increase of nearly 3% in August, according to the Federation of Automobile Dealers Associations (FADA). But concerns remain over how ongoing semiconductor shortages and inflation will impact the industry moving forward.

Last month, total vehicle retail sales reached 19,64,547 units, a 2.84% increase from August 2023, according to the FADA. The organization also noted that passenger vehicle sales were up marginally, at 3,23,256 units compared to 3,20,291 a year earlier.

"Sales of electric vehicles continued to soar, but the growth trajectory is beginning to slow down as supply shortages kick in," said the FADA.

The semiconductor chip crisis has led to production cuts from a range of automakers, including Toyota, Volkswagen, BMW, and General Motors.

Recent high inflation and rising interest rates have also cast a shadow over the industry. The FADA said it's difficult to predict how the industry will fare in the coming months.

"Consumer sentiment has been severely hit... it will certainly impact the sales in the coming months, especially in the entry-level passenger vehicle and two-wheeler segments," said the industry body.

The FADA did not reveal specific sales figures for electric vehicles, though the organization has previously said that sales of EVs had risen nearly three-fold in the last year.

The automotive industry is one of several sectors facing headwinds, as rising interest rates and inflation continue to spook consumers and impact demand.

The question is how long the industry and consumers can endure these supply constraints and how that could impact the industry as a whole in the longer term.

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