Marginal growth in car sales likely in current fiscal: SIAM

Anticipates some positives in terms of lowering of interest rates

Helped by better consumer sentiment and excise duty sops on vehicles, cars sales in the country rose by 2.46 per cent in 2014.

In 2013, car sales had registered a decline of 9.59 per cent, the first fall in car sales in eleven years.

Passenger car sales in the January-December, 2014, period rose to 18.51 lakh units from 18.07 lakh units in 2013, according to data released by the Society of Indian Automobile Industry (SIAM).

While the industry body does not see sales growth for the current fiscal to be negative due to cars getting dearer following expiry of excise duty cuts, growth is likely to be marginal at around one per cent.

“Only three months are left for the fiscal to end. While excise duty sops have expired, we are anticipating some positives in terms of lowering of interest rates. Globally, fuel prices are also coming down, that should also have a positive impact,” SIAM Deputy Director-General Sugato Sen said.

Meanwhile, the domestic car sales soared by 15.26 per cent to 1.53 lakh units in December, mainly driven by advance purchases by customers in anticipation of price rise in January as it was expected that excise duty concessions would not be extended. While the growth in December is the highest so far in the ongoing fiscal, Mr. Sen said this was mainly because of the low base of last year when cars sales had declined considerable. Sequentially, sales were down as compared to November when sales stood at 1.56 lakh units, he added.

Asked about the commercial vehicle segment, which saw sales drop by 11.8 per cent to 6.06 lakh units in 2014, Mr. Sen said the sector had seen some improvement, but did not perform well as “real economic activity is still to gain steam.”

Sales of commercial vehicles rose by 9.01 per cent to 51,000 units in December.