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The Federation of Automobile Dealers Associations (FADA) has said that domestic passenger vehicle (PV) retail sales declined 8 per cent in February 2022 as the companies continued to suffer production loss due to chip shortage. The PV sales dropped to 2,38,096 units in February, down 7.84 per cent from 2,58,337 units in February 2021. 

FADA has indicted that two-wheeler sales in February 2022 declined 10.67 per cent to 9,83,358 units, compared with 11,00,754 units in February 2021. Tractor sales stood at 50,304 units last month, down 18.87 per cent from 62,004 units in February 2021. Commercial vehicle sales, however, witnessed a growth of 7.41 per cent last month at 63,797 units, as against 59,395 units in the year-ago month. The total sales across categories last month declined by 9.21 per cent to 13,74,516 units from 15,13,894 units in February 2021.

The industry body stated that even though the PV segment saw some launches and slight respite in supply due to better production, it was not enough to meet customer demand. Vehicle waiting period thus remains similar to what it was in the past few months. It warned that the Russia-Ukraine conflict could further impact the production of semiconductors. It noted that Russia is one of the largest producers of rare-earth metals, especially Palladium, which is an essential metal for semiconductors. Ukraine, on the other hand, is one of the biggest producer and exporter of neon gas, which is used in the manufacturing of semiconductors.