Dear Friends,

In June, the auto retail industry experienced a year-on-year growth of 10%, albeit countered by an 8% month-on-month decline, and a 3% drop when compared to pre-COVID levels. Despite these fluctuations, growth was observed across all segments, with Commercial Vehicles surpassing pre-COVID levels by 1.5%. The two-wheeler sector, however, faced a 12% month-on-month downturn, further exacerbated by a 56% decrease in electric vehicle sales due to cuts in the FAME subsidy. The Passenger Vehicle sector showed resilience amidst variable demand and the CV sector experienced growth, driven primarily by governmental infrastructure initiatives.

Maruti has taken an innovative step by offering interest support on entry-level passenger vehicles in stock for over 30 days at the dealer's end. This action, which is highly appreciated by the Federation of Automobile Dealers Associations (FADA), will undoubtedly alleviate the financial stress for dealers. It's crucial to highlight that dealerships are financially impacted when any stock remains unsold beyond a 30-day period.

The July'23 and near term outlook predicts mixed trends. Challenges persist in the 2W market and EV sales due to FAME cuts, while 3W expects growth. The PV sector anticipates a boost from new models and the festive season, despite OEM inventory pressures. The CV sector sees positive sentiment but potential monsoon impacts. Agricultural irregularities due to erratic monsoons could impact rural auto demand, but upcoming rains offer potential relief. FADA retains cautious optimism.

Transitioning to FADA's initiatives, I am pleased to highlight our proactive engagements with Central Ministries to address various challenges faced by the auto dealer community. FADA's meeting led our CEO Mr. Saharsh Damani with the Delhi GST Joint Commissioner Dr Atish Kumar focused on the potential reduction of GST rates on two-wheelers from 28% to 18%. Our proposal was well-received and we've received assurances that it would be sent as an agenda item in the subsequent GST Council meeting.

Furthermore, we have communicated our concerns to the Hon’ble Finance Minister regarding the notices dealers received for 1) not classifying all supplies as intra-state supplies; and 2) non-payment of GST on Registration and Insurance charges.

Simultaneously, FADA reached out to relevant departments in Andhra Pradesh, seeking extension of Life Tax Exemption on Electric Vehicles due to its adverse impact on the sales and registration of these vehicles.

As India's leading representative body of Auto Retail, FADA has been working closely with MoRTH to simplify the documentation process for dealer applications and renewals of Trade Certificates. With varying state-wise requirements, the current process can be daunting, and our effort is aimed at promoting ease of doing business.

Moreover, we have initiated legal proceedings to advocate for the nationwide implementation of the New CMV Rules, 1989 as notified by MoRTH, ensuring a uniform regulatory environment across all states.

State chapters of FADA have been instrumental in convening meetings to discuss and strategize on regional concerns faced by our community. One such meeting, led by Mr. Soham Misra, State Chairperson FADA West Bengal, was recently organized by FADA West Bengal Core Team Members and Regional Directors.

Similarly, Women in FADA (WIF) Directors have been active in bringing more women leaders at the forefront. Mrs. Rashmi Kale, WIF Director of Chhattisgarh, and Mrs. Pema Loyi, WIF Director of Assam, organized fruitful meetings in their respective states to bring more traction within the women leaders in Auto Retail.

These gatherings not only offer us a deeper understanding of the challenges faced at the state level, but they also chart a course for future endeavors at the chapter or vertical level. Consequently, they bolster FADA's credibility and strengthen our foundation. These initiatives also significantly widen FADA's outreach, expanding our influence across the country.

Friends, I am delighted to extend an invitation to our 59th Annual General Meeting, scheduled for Thursday, September 14, 2023, at the Sovereign Hall, Le Meridien, New Delhi. An official notice detailing the event would have reached you. I encourage all FADA members to attend this pivotal gathering, contribute to our deliberations and engage in our Federation's activities.

Following the morning's AGM, we will host the 5th Auto Retail Conclave in the afternoon, under the thematic banner, "Collaborate, Innovate & Accelerate". This theme reflects our unwavering commitment to fostering industry synergy, nurturing innovation, and driving growth.

Our annual convention is set to be an enlightening experience, filled with insightful discussions and thought-provoking exchanges. As the day progresses, we will present the Golden Dealership Awards, honoring those exceptional dealerships that have made significant contributions to auto retail for over 50 years. To further celebrate these remarkable journeys, a Coffee Table book will be unveiled during the Conclave's inauguration.

The day will culminate in the award presentation of the Dealership Satisfaction Awards 2023. We are currently finalizing a detailed program for the day, which will be shared soon. Please ensure your registration to participate in this event, enabling us to collectively showcase the resilience and strength of our industry to the wider automotive ecosystem.

Friends, I am delighted to share that our forthcoming awards will be significantly influenced by your valuable insights gathered through the Dealer Satisfaction Study Survey, which is now live.

For those who have registered, you would have received a crucial email from [email protected], titled "Elevate Your Voice: Participate in FADA's Dealer Satisfaction Study 2023." This communication provides you with critical information about the study, inclusive of the survey link and an outline of questions. Please note that this link is exclusive to your email and will not be shared via WhatsApp.

The Dealer Satisfaction Study embodies FADA's unwavering commitment to enhancing the Dealer-OEM relationship. However, for the first time in FADA's history, we are expanding the survey's scope to include Banks, Finance, and Insurance companies. This broader survey will provide a more comprehensive view of our industry and enable us to pinpoint areas of potential collaboration and improvement.

This exercise is more than an evaluation; it is an industry-wide mirror, reflecting our collective achievements and challenges. The subsequent awards will honor those OEMs, Finance, Insurance Companies, and Banks that have demonstrated remarkable dedication to our shared goals, establishing a foundation of mutual trust and growth.

In essence, DSS'23 is By the Dealers, For the Dealers, and From the Dealers. Your participation is not only welcomed, but also invaluable. I encourage your active involvement across all brands, segments, and financial institutions you interact with.

I eagerly anticipate your engagement and continued support.

Best Regards,

Manish Raj Singhania
President, FADA