Did this sale season dispel some of the gloom that the economy has found itself in during the last several quarters? And if it did, by how much?Latest sales data from automobiles and consumption — the two sectors that have become the face of this slowdown — may provide some insights. These data points may help understand whether or not did Diwali cheers drive away India's consumption blues, and what the post-festival sales numbers really mean.Here is an account of how these two key sectors — one accounts for 60 per cent of India's GDP and the other makes up over half of our total manufacturing output — got stuck in multi-year troughs, and what this Diwali may have changed for them.Let us start with auto, the sector that data shows has shed lakhs of jobs and has gone from being a GDP star to being a drag on growth in a matter of months.It all started with the new third-party insurance rule last year which states that if you buy a car after September 1, a portion of your motor insurance premium representing the third-party (TP) liability has to be paid upfront for three years. This means new car buyers now have to shell out more for their motor insurance policies in the first year. For new two-wheeler buyers, the premium for third-party liability of five years will have to be paid upfront.Then came the shadow bank liquidity crunch — probably the single biggest factor in the auto slump. NBFCs dramatically slashed lending in the wake of IL&FS's collapse, affecting the growth of the entire industry.Till that point, NBFCs were helping fund nearly 55-60% of commercial vehicles (both new and used), 30% of passenger cars and nearly 65% of the two-wheelers in India, ICRA data shows. Following the collapse, interest rates for car buyers have gone up in the last 12 months despite the RBI cutting rates, says RC Bhargava, chairman of Maruti Suzuki.The impending deadline of mandatory transition to BS-VI from BS-IV emission norms has also proved a hassle for carmakers and car buyers alike. The increased cost associated with this technology change could discourage buyers significantly, analysts say.The continued confusion over the proposed deadline to convert some vehicle categories to electric has not helped either. Electric vehicles are not available/affordable for the Indian buyer yet — they are only accessible to the government or private contractors.With muted consumer activity in both urban and rural markets, auto industry has had a bumpy ride in the last one year, shows data from SIAM, the apex national body representing all major vehicle and vehicular engine manufacturers in India.According to SIAM, during the past year, the auto sector witnessed falling sales and piling up inventory, with industry leaders like Maruti Suzuki and M&M forced to lay off thousands of workers to deal with the prolonged slump.Passenger vehicles sales in India had hit rock bottom in the year through August on rising prices, scarce loans and a deep demand slump. It was the first time in 10 years that sales fell continuously for an entire year.That was before the festivals. The shopping season did give carmakers some major cheers after a year of gloom — sales rose 5-7% this Navratri, Dussehra and Dhanteras from a year ago. Two-wheelers didn't see much of a festive spike, though sales did improve over previous months.How much does this festive cheer mean to an industry battling an entrenched slump in demand? Analysts are subdued in their enthusiasm. Maruti and Hero MotoCorp — the biggest carmaker and the biggest two-wheeler maker, respectively — themselves maintain that it is too early to take cues from this rise.For the record, both four- and two-wheelers sell double the usual monthly average during the month-long festive in India. In some great years, festive numbers have even gone up 3.5-4 times usual monthly sales.Things were bleak for the auto industry till the onset of the festive season. The industry produced a total 14,427,724 vehicles including passenger vehicles, commercial vehicles, three-wheelers, two-wheelers and quadricycle in April-September 2019 as against 16,645,330 in April-September 2018, registering a de-growth (-) 13.32 per cent over the same period last year.One corner of the auto market, however, largely escaped all this mayhem. Lamborghini India announced it was set to post a significant 30% rise in sales in 2019. Mercedes Benz India also over witnessed strong festive demand for its cars, with this year’s festive season deliveries surpassing those from 2018.The top-of-the-line Mercedes SUV, the GLE, is sold out for three months, the company said. The X7, the top SUV from BMW India , was also sold out.For the ecommerce industry, last year's festive sales had clocked a record 76 per cent year-on-year growth. But sales turned tepid almost immediately after that spike as weak consumer sentiment became more and more entrenched.Matters became more complicated after the government's new FDI rule that debarred online marketplaces from manipulating the price of products or offer deep discounts. As a result of this move, online discounts nearly halved in 2019 compared to the 2018 levels.After the IL&FS debacle, NBFCs and banks were — and still are — less willing to offer consumer loans. It hurt the EMI economy in a major way as premium phones and other large/costly equipment were suddenly out of reach for many consumers.All these factors apparently contributed to a deepening of the weak sentiment as the buyer turned unwilling to purchase discretionary items, sometimes even delaying purchases of staples. Meanwhile, credit became even harder to come by as lenders of all hues, wary after IL&FS, drastically cut down on new loans.The worries of the EMI economy soon seeped into broader consumption numbers. FMCG biggies spoke with one voice how sales were plummeting — or more precisely, how the average Indian consumer was not even buying Rs 5 biscuits.All this indicated etail could be staring at the spectre of a disappointing Diwali when this year's festive sale opened.With less money in circulation owing to this credit scarcity, what else could India expect but a dire Diwali marked by a consumption slump, right?Not quite. Etailers made a whooping $3 billion (over Rs 21,000 crore) in just the first six days of festive sales this year. Based on this number, the year-on-year growth for etailers, led by Flipkart and Amazon, was 30 per cent, a report by consulting firm RedSeer says.A big chunk of customers this year was from Tier-II cities, the report said. Before the sales began, RedSeer had said there would be a 60% jump in the number of online shoppers from 20 million last year to 32 million this year.For the full festive season, Amazon and Flipkart were expected to make a cumulative $5 billion (Rs 36,000 crore) in gross merchandise value (GMV) this year. Sales eventually missed these targets, but only marginally. According to analysts, this near miss was due to customers' preference for more affordable items, which dragged down the order value, while the number of units sold remained well in line with industry predictions.Brick and mortar retailers also had a strong finish to this festive season, with Diwali sales of smartphones, electronics apparel and consumer products rising about 7-9 per cent.This was a crucial, make-or-break Diwali for these businesses since sales of most categories had fallen or remained flat because of poor consumer sentiment.Brick and mortar businesses and consumer goods companies were fearing the worst this year in both urban and rural India due to a slowing economy over the last three quarters or so. These fears proved unfounded as this year's Diwali and overall festive season sales beat expectations quite handsomely, analysts said.Here is one more data point that may matter. Despite stellar sales by the ecommerce majors, the footfall in malls went up noticeably during the festive period. Does this combined surge of etail & physical retail signal that a consumption recovery has possibly begun? We'll know for sure in a bit.