The Hindu : Andhra Pradesh / Hyderabad News : Car sales tumble in city Recession affect

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Saturday, Dec 06, 2008
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Andhra Pradesh

Andhra Pradesh - Hyderabad

Car sales tumble in city Recession affect

Abhijit Dev Kumar

Market for luxury cars falls by 50 per cent

Banks averse to extending easy loans
Automobile manufacturers cut down production

Photo: Nagara Gopal

Slowdown: Car sales have come down during the past few months due to the economic crunch. -

HYDERABAD: It’s a journey in lower gears for the car market in the city. The number of new cars rolling out of showrooms decreased in the last few months with buying trends and preferences undergoing a drastic shift.

“Those who used to walk in to buy luxury cars are now opting for smaller ones, especially hatchbacks. The overall drop in sale of small cars during November is about 15 per cent, which is nominal compared to the luxury car segment. This is because there is a car available for a differential of every Rs.50, 000 on sale price, depending on the vehicle’s make and model,” says Vinay R. Saboo, M.D. of RKS Motors Pvt. Ltd.

With banks applying brakes to the easy loan process, some buyers are making total payment instead of applying for a loan.

“After the markets tumbled, investors are averse to taking loans,” Mr. Saboo points out.

Interestingly, there is no sliding in the number of enquiries for cars. “We have customers enquiring for small cars. It is also true that people today are holding onto their money and are following the market closely,” says Sachet Stalwart, Director of Stalwart Hyundai. Small cars such as Alto, Wagon R, Santo, i10 and the latest from Maruti stable, A-Star, enjoy their share of demand. Its two weeks since launch, and 15 ‘A-Stars’ have already been sold.

“Presently, there is no movement in the real estate sector, which took the hardest hit during the recession. The IT sector, which fuelled the enormous growth of car market, is now on a bumpy road. As a result, the luxury car market has fallen by almost 50 per cent,” says Mr. Talwar. With the meltdown, almost no signs of recovery in the near future, dealers say that stability of the automobile industry is far from reality as a lot of manufacturers have cut down on production.

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