EXCLUSIVE ANALYSIS: INDIA: Passenger car sales fall marginally in June
The Indian passenger car market registered a slight dip of 0.89% to 64,464 units from the 65,046 units sold in June 2004.
The drop was widely attributed to a delay in the onset of monsoon rain in the northern region, an increase in fuel prices and flash floods in the coastal state of Gujarat.
There was also lingering concern over the implementation of VAT and the government's deferred reduction of import duties, which also affected car sales last month.
Six of the 11 car manufacturers in the Indian market reported a fall in volume for the month. Competing in the high volume segment, sales leader Maruti posted a rise of 4.6% to 37,995 units while others, including Hyundai and Tata, saw sales decline.
Maruti's growth was attributed to the introduction of the Suzuki-designed Swift which helped accounted for 31% of its hatchback sales while the ancient M800 - based on a early '80s Suzuki Alto design - continued to decline, by 40% last month.
Hyundai sales were off 11.8% to 10,719 units. Sales of its hatchback Santro Xing slowed 18.5% due mainly to competition from newer rivals, primarily the Swift.
Tata, another player in the mass market, also posted lower June sales. Its Indica hatchback and Indigo saloon derivative declined 7.7% and 8.9% respectively.
Higher up the market, General Motors India sales volume was off by close to 10% last month. Though its home-grown Chevrolet Tavera line continued to attract buyer interest, the GM Daewoo-designed Optra showed signs of slowing.
However, GM's June sales were also affected by floods in and around the assembly plant near Baroda, Gujarat, which disrupted production and shipments. In fact the company lost 300 units due to the rain.
Skoda, Toyota and Honda grew sales in June.
The overall decline is seen as only temporary and the industry confidently expects double digit growth after the monsoons depart.
Deepesh Rathore / Tilak Swarup