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Updated: September 11, 2013 01:14 IST

Car sales rise for the first time in 10 months

Yuthika Bhargava
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Domestic passenger car sales grew by 15.37 per cent to 1,33,486 units in August this year, compared to 1,15,705 units in the same month last year: SIAM

Car sales in the country increased for the first time in ten months, rising 15.4 per cent in the month of August, driven by a surge in sales by market leader Maruti Suzuki India (MSI) due to a lower base.

Domestic passenger car sales grew by 15.37 per cent to 1,33,486 units in August this year, compared to 1,15,705 units in the same month last year, according to data released by Society of Indian Automobile Manufacturers (SIAM).

However, the industry body said the automobile market continues to reel under the slowdown in demand due to sluggish economic growth, high fuel and interest costs.

“This (growth) is not a reflection of the market conditions. This is mainly due to Maruti's numbers compared to last year. The tough market conditions still remain. Interest rates are high, fuel prices continue to be high while sentiments are extremely low,” SIAM Deputy Director General Sugato Sen told reporters here.

He said the positive growth seen in August is unlikely to be sustained in September and a recovery in the market is likely to happen only in the next couple of quarters.

“For this fiscal, we are staring down at a negative growth of car sales. If we have to match last year's 2.7 million units, we need to be selling over two lakh units each month but in the last three months, we have sold less than that,” Sen explained.

In August, MSI doubled its domestic car sales at 63,499 units against 31,653 in the same month last year. The company had declared a month-long lockout at its Manesar plant in August 2012 following a violent labour unrest in which a senior executive was killed.

Hyundai Motor India Ltd registered a marginal increase during the month at 28,281 units against 28,192 units last year, while Tata Motors’ sales plunge by 50.57 per cent to 8,761 units. Mahindra & Mahindra saw its domestic passenger vehicles sales decline by 25.45 per cent to 18,137 units during the month.

According to SIAM data, motorcycle sales grew by 3.82 per cent last month to 7,95,378 units from 7,66,127 units in the same month of previous year.

“The good monsoon has had an impact on rural sales of two-wheelers, specially that of motorcycles. We expect this to continue and the rural demand could also have a slight positive impact on car sales,” Sen said.

Scooter sales during the month were at 2,83,142 units as against 2,33,180 units last year, up 21.43 per cent. Total two-wheeler sales in August 2013 grew by 6.68 per cent to 11,28,598 units from 10,57,925 units in the same period of previous year.

Sen said the medium and heavy commercial vehicles segment (M&HCV) has been badly affected and it witnessed a decline for the 18th consecutive month. During the month, M&HCV sales were down 38.24 per cent at 15,468 units.

Total sale of vehicles across categories registered a growth of 4.47 per cent to 14,12,512 units in August 2013 as against 13,52,025 units in the same month of 2012, it added.

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