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New Delhi: India’s auto dealers have warned that supply and dispatch issues could happen soon as the ongoing West Asia conflict is increasing costs across the industry. The situation is affecting raw materials, fuel, and logistics, which are all important for vehicle production and delivery. Despite this concern, the industry has just closed the financial year with record sales.

According to a Reuters report, the Federation of Automobile Dealers Associations (FADA) said the overall environment remains uncertain due to the conflict. Rising oil and gas prices are making transportation and production more expensive, while metals like aluminium, copper, and steel are also getting costlier.

Rising costs and possible delays

Dealers said the biggest impact is being seen in the commercial vehicle segment, where supply issues are more noticeable. However, passenger vehicles and two-wheelers are not fully spared either. Some dealers are already seeing delays, but it depends on the model and variant. Higher fuel and transport costs are also making things difficult, slowing down the movement of vehicles from factories to showrooms

Strong sales despite challenges

Even with these concerns, March saw strong growth in retail auto sales. Overall sales went up by 25.28% compared to last year. Passenger vehicle sales rose by 21.48%, while two-wheeler sales increased by 28.68%. Commercial vehicles also saw a growth of 15.12%.

For the full financial year, total retail sales were up by 13.3%, showing steady demand in the market. FADA also noted that passenger vehicle inventory levels improved. The average time a car stayed in showrooms dropped to around 28 days in March, compared to 52 days in the same month last year.