The once-booming passenger car sector is poised to post its worst annual performance in a decade, industry body Society of Indian Automobile Manufacturers said on Monday, after reporting a 12 per cent plunge in auto sales in January.
Car sales slid by 12.45 per cent to 1,73,420 units in January from the same month in 2012, the Society of Indian Automobile Manufacturers (SIAM) said.
“We now think passenger car sales growth for the (2012-13 financial) year will be in negative figures,” SIAM deputy director general Sugato Sen told AFP, adding “the last time we had a negative (figure) was in 2002-03”.
“The industry is in tough times,” Sen said.
The weak figures come as vehicle sales in China, the world's largest car market, shifts back to higher growth. But passenger sales growth in India has been in decline since 2010.
Increased ownership costs, such as costlier fuel and steep interest rates, have also deterred buyers.
"SIAM had already slashed its passenger car sales growth forecast for the fiscal year to March 31 to zero-to-one percent from an initial 10 to 12 percent. Sen said there would be no further official revision but added the group did not expect a recovery in car sales in the final financial quarter. Sales for April to January were down around two percent from the same period a year earlier, Sen said. Total sales of trucks and buses slumped by 9.51 percent to 63,218 units in January from a year ago.
The SIAM official said there was “still major headroom there for growth” in the car sector longer-term thanks to a highly under-penetrated market. Just one in 11 households in cities and one in 50 in rural areas own cars, SIAM said.
In January, all the major car makers struggled to post good sales numbers. Market leader Maruti Suzuki India posted a marginal rise at 88,557 units against 88,377 units in the same month last year. Hyundai Motor India had reported 1.45 per cent growth at 34,247 units (33,756 units), while Tata Motors’ domestic sales crashed by 60.76 per cent to 11,192 units (28,529 units).
According to SIAM, motorcycle sales in January this year grew 7.45 per cent at 8.87 lakh units against 8.25 lakh units in the same month of previous year.
Hero MotoCorp (HMC) had posted sales of 4.94 lakh units (4.66 lakh vehicles). Bajaj Auto reported sales of 1.96 lakh units (2.02 lakh units), while that of Honda Motorcycle and Scooter India (HMSI) was at 1.06 lakh units (68,212 units). Total two-wheeler sales in January 2013 increased by 8.46 per cent to 12.07 lakh units from 11.13 lakh units in the same period of the previous year, SIAM said. —AFP, PTI
The industry is
in tough times,