Revenue growth of auto dealers to slow down in FY25

The revenue growth of auto dealers is expected to slow to 7-9 per cent this financial year after a healthy 14 per cent last year, due to a moderation in sales volume growth and modest price hikes by car manufacturers, asserted Crisil Ratings.

Lower sales volume growth has led to higher discounts and offers by manufacturers and dealers over the past few months, the rating agency said in a report this week.

While a large part of the impact is borne by the manufacturers, it will still pull down the profitability of auto dealers to 3 per cent, a tad lower than the average of 3.5 per cent seen in the past three years.