Car sales in reverse gear for 6 months in a row
Fall more than 10% during April on weak consumer sentiment, high interest rates Car sales in India fell...
Fall more than 10% during April on weak consumer sentiment, high interest rates Car sales in India fell for the sixth month in a row in April, the longest stretch of decline since industry body SAIM started collating data in 1997-1998, as weak consumer sentiments, high interest costs and other macro-economic factors continued to hurt demand. According to the data released by the Society of Indian Automobile Manufacturers (SIAM), domestic passenger car sales declined by 10.43 per cent to 1,50,789 units in April this year compared to 1,68,354 units in the same month of 2012. "Weak consumer sentiment is affecting car sales. The Budget hasn't done anything to improve market sentiments. This is the sixth month that we are witnessing fall in car sales," SIAM Deputy Director General Sugato Sen told reporters here. He said the last longest stretch of fall in domestic car sales was between March 2002 and July 2002. "Car sales have been falling in India since November last year. We have never witnessed such a long consecutive decline in car sales since data has been analysed by SIAM since 1997-98," Sen added. Although the cut in petrol price by Rs 3 per litre last month is a positive signal, he said other factors like high interest rates, despite witnessing a marginal decline recently, continue to affect demand. Previously interest on car loans ranged around 11-15 per cent. On the outlook, Sen said: "The decline in sales is expected to continue for about the next two months and we may see some growth as buyers of entry level small cars have started coming to showrooms after the positive signals on the fuel price front." Launch of new models by different companies, such as Amaze by Honda Cars India and Enjoy by General Motors India, could also help in boosting sales in the coming months, Sen added. "After three-four months, we are hopeful that car sales will begin to grow," he said. During April this year, market leader Maruti Suzuki India posted a growth of 4.89 per cent in its domestic car sales at 76,509 units from 72,939 units in the same month last year. Rival Hyundai Motor India, however, had a 7.53 per cent decline in sales at 32,364 units as compared to 35,000 units last April. Homegrown major Tata Motors sales crashed by 52.07 per cent to 8,918 units from 18,610 units during the period under review. Sen said the rate of decline in car sales for April this year at 10.43 per cent is the highest since 2002, when it fell by 22.82 per cent in the same month.