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Festive car sales face supply crunch

By Sohail Khan 21 September 2026, 12:52 am

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Business News›Industry›Auto›Auto News›Auto sales: Strong festive demand may hit by low dealer stocks, supply constraints

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Auto sales: Strong festive demand may hit by low dealer stocks, supply constraints
Synopsis

As the festive season approaches, car manufacturers are grappling with low inventory levels despite a surge in customer bookings. Supply constraints present a formidable hurdle, particularly for Maruti Suzuki, which currently has a backlog of over 200,000 orders with dwindling stock. Anticipating a slowdown in growth, Hyundai Motor India is ramping up production to accommodate the expected rise in demand.

cars2 — Strong festive demand may not fully translate into car sales as automakers face tight inventories and supply constraints. Maruti Suzuki has over 2 lakh pending bookings.

Mumbai | New Delhi: Low levels of stocks at dealerships could weigh on car sales this festive season, with the top five manufacturers that account for more than 85% of the market struggling to build inventory even as bookings remain strong.

The second leg of the festive season, starting with Navratri on October 11 and through Diwali on November 10, is expected to be positive from a demand perspective, but companies may not be able to fully make use of that because of supply constraints, said industry executives. This one-month period is crucial for automakers, as it accounts for a third of their annual sales.

Also Read: JLR begins talks with global banks for $1.3 billion five-year loan

Market leader Maruti Suzuki has pending bookings for more than 200,000 units, while its network inventory is currently enough to last only around 16 days of sales compared with the stock for roughly one month it typically carries during the festive period.

ET Bureau

"At the beginning of this financial year, we had 13 days of stock. Even now we are having 16 days of network stock, and our pending booking is now more than 200,000. We don't see that (having a full month of stock) till December," said Partho Banerjee, senior executive officer, marketing and sales. The company's new automated production lines are expected to stabilise fully by December, he said.

Also Read: Mahindra XUV 3XO REVX EDGE launched at Rs 9.39 lakh

Maruti's sales have grown 35% so far this fiscal year, compared with around 30% industry growth between April and August. Banerjee said vehicle availability would be a key factor in the second half of the fiscal year, as production days decline during the festive period.

"To be able to unlock the full potential of the festive season, we need to build inventory which seems to be a challenge this year. We are finding it tough to meet demand even for regular months," said a top executive at another automaker.

While sales in August and so far in September were higher, October and November could be challenging, the executive said. The industry, therefore, may have to contend with low single-digit growth over last year for the season, he said.

The festive calendar is more spread out this year, with Onam in August, Ganesh Chaturthi in September and Navratri, Dussehra and Diwali during October-November. Last year, Navratri, Dussehra and Diwali were concentrated in October, making year-on-year comparisons less straightforward this season.

Hyundai Motor India has four-five weeks of inventory heading into the second half of the festive season and is advancing the commissioning of a third shift at its Talegaon plant in Maharashtra ahead of the launch of a midsize SUV next month.

"Industry growth is expected to taper off and close at about 5-6% in the second half of the fiscal, on a high base. We expect to grow faster than the market with our two new launches," said Hyundai Motor India managing director Tarun Garg.

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