Automobile retail sales rose 10 per cent in May on the back of robust demand across segments including passenger vehicles, two-wheelers and tractors, automobile dealers' body FADA said on Monday. The total automobile retail sales jumped to 20,19,414 units last month, from 18,33,421 units in May 2022.

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Passenger vehicle sales rose by 4 per cent to 2,98,873 units in May, as compared to 2,86,523 units in the year-ago period.

The Federation of Automobile Dealers Associations (FADA) President Manish Raj Singhania said improved availability of vehicles coupled with pending order list and the robust demand for new launches drove a positive momentum, helping the passenger vehicle segment rebound after a slump in the previous month.

Two-wheeler retail sales last month rose 9 per cent to 14,93,234 units, as compared to 13,65,924 units in May 2022.

"The two-wheeler sales were positively influenced by seasonal factors like the marriage season, changes in the FAME subsidies effective from June, and the recovery of rural demand," Singhania said.

Commercial vehicle retail sales rose by 7 per cent to 77,135 units last month, as against 71,964 units in May last year.

Three-wheeler retail sales rose 79 per cent to 79,433 units last month, as compared to 44,482 units in the year-ago period.

Tractor sales rose to 70,739 units, up 10 per cent, as compared to 64,528 units in May 2022.

On business outlook, FADA said that the anticipated stable interest rates by RBI's Monetary Policy Committee could maintain vehicle demand and positively impact auto sales.

However, supply chain issues, demand-supply dynamics, and regulatory changes also play a role in shaping the auto retail outlook, it added.