The car sales growth rate in India dropped to a twelve-year low in February, as high fuel prices, rising interest rates and a slow economy continued to hit consumer demand.
Passenger car sales in the country fell 25.71% year on year to 158,513 vehicles in February. The Society of Indian Automobile Manufacturers (SIAM) expects car sales growth to be in negative territory in fiscal 2012-13.
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SIAM deputy director general Sugato Sen told PTI, “The decline in car sales in February was the biggest since December 2000, when sales declined by 39.86%. The market continues to be extremely difficult as high fuel prices, interest rates and overall macroeconomic factors are adding to low consumer sentiments.”
According to SIAM, the cumulative production data for April-February 2013 shows production growth of only 2.18% over the same period last year. The industry produced 1,731,824 vehicles in February 2013 as against 1,791,795 in February 2012, which declined by 3.35%.
The overall growth in domestic sales during April-February 2013 was 3.68% over the same period last year, while in February 2013 overall sales fell by 5.45% over February 2012.
The passenger vehicles segment grew at 4.07% during April-February 2013 over the same period last year. Passenger cars declined by 4.64%, utility vehicles grew by 54.46% and vans grew only by 1.02% during April-February 2013 as compared to the same period last year. However, in February 2013 passenger car sales further declined by 25.71% over February 2012. Total passenger vehicles sales also declined by 16.67% in February 2013 over the same month last year.
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By GlobalDataThe overall commercial vehicles segment registered de-growth of 1.51% in April-February 2013. While medium and heavy commercial vehicles (M&HCVs) declined by 22.79%, light commercial vehicles grew at 14.53%. In February 2013, M&HCVs sales further declined by 34.72% over February 2012.
Three wheelers sales grew by 5.05% in April-February 2013, passenger carriers grew by 8.89% and goods carriers registered de-growth at 9.64%.
During April-February 2013, overall automobile exports registered de-growth of 1.66%. Passenger vehicles grew by 9.67%, while the other segments like commercial vehicles, three wheelers and two wheelers fell by 11.89%, 17.66% and 1.05% respectively. In February 2013 passenger vehicles and two wheelers grew by 32.05 and 14.21% respectively and commercial vehicles and three wheelers declined by 24.30 and 3.33% respectively.
When asked if the announcements for the 2013-14 Budget would boost the auto industry, Sen said there were some positives for the overall sector, but the higher taxes on SUVs – the fastest growing segment – were disappointing.
Sen said, “The feedback we have received from the companies is that in the next three-four months they don’t see any significant improvement, even new model launches are unlikely to lift the sentiments. They are, however, optimistic that in the second half of the year sales may again pick up… Usually, the last month of the fiscal (March) is the highest selling. Even of that were to happen this year, we are unlikely to meet our forecast of a growth of 0-1% as we are down by 4.64% in the April-February period this year.”
