Ummid Assistant

Jamia Millia launches courses on China, Afghanistan

IGNOU launches value education programme for teachers

Welcome Guest! You are here: Home Business & Economy

Sliding car sales may reverse in March-April 2012: Automakers

Monday November 21, 2011 12:36:31 PM, Mithun Dasgupta, IANS

Related Article

Strike, interest rates dampen automobile sales

Production losses at industry leader Maruti Suzuki and a slump in sales because of high interest rates and rising fuel prices have resulted in a grim sales picture for the auto industry in October. Crippled by a fortnight-long strike at its manufacturing facility in Manesar in Haryana, Indian   

Kolkata: Automobile makers are keeping their fingers crossed on the revival of India's passenger car industry after a dip in sales for the fourth consecutive month till October on the back of high fuel prices and interest rates. Some manufacturers, however, expect the market to show some signs of recovery from next March-April.

Car sales in India, the world's second fastest growing automobile market after China, were down by 23.8 percent in October. It was the biggest monthly percentage decline since December 2000.

The Society of Indian Automobile Manufacturers (SIAM) has cut its sales growth forecast for the current financial year to 2-4 percent from its earlier projection of 16-18 percent due to soaring interest rates and continuous rise in petrol and commodity prices.

Maruti Suzuki India Ltd. (MSIL), the country's largest car maker, said the trend of fall in sales was likely to continue if the macro-economic conditions remained unchanged.

"Passenger car sales are substantially down obviously due to high fuel price and rising interest rates. The trend is likely to continue if the macro-economic conditions of the country do not change," MSIL chief general manager (marketing) Shashank Srivastava told IANS on the phone from Gurgaon.

The company, which earlier slashed its sales growth target from 13 to eight percent for this fiscal due to inflation and other issues, now says even this is unlikely in the current economic scenario.

"That (8 percent sales growth) target looks will be less than that," Srivastava said.

He also said the recent petrol price cut by the country's oil retailers by Rs.1.85 per litre, the first cut since January 2009, will not have any impact on the weak demand.

The state-run oil marketing companies raised the prices of petrol, the fifth increase this year, by Rs.1.85 per litre earlier this month before slashing the prices.

Global automotive major General Motors expects that the country's gloomy car market, which has been experiencing sluggish demand from January 2011, may show signs of revival from March 2012.

"The market will remain dull till February next year. It may revive after the budget session (of parliament), depending on the budget proposals," said General Motors India vice president P. Balendran.

He said that now about 80 percent of the car demand was for the diesel versions after the consecutive petrol price hikes by the oil marketing companies.

General Motors India reported a marginal increase in its sales in October this year at 10,062 units compared to 10,051 in the same period an year ago.

Balendran said the company was able to jack up sales, despite the dull market, due to high demand for its hatchback Beat diesel.

Asked whether high demand for diesel cars would continue if the government de-controlled diesel prices, he said: "As long as the gap between the prices of petrol and diesel remains, the high demand for diesel cars will continue."

Diesel is currently sold below its economic cost with a subsidy given by the central government.

"Automobile companies in India are facing a tight situation because of high fuel cost and rising interest rates," an official of Toyota Kirloskar Motor Pvt. Ltd. told IANS, requesting anonymity.

The country's central bank has raised its key lending rates 13 times since March 2010 to tame the stubborn inflation.

He said demand for cars will increase when the overall economy picks up.

"For boosting weak domestic consumption, first there should be some investments in the the end of the day consumers buy cars," he added.

Renault, a French automobile manufacturer, said the dull Indian car market might somewhat revive after April if the interest rates stabilised.

"I hope the government will do something to stabilise the rates. Because then only the customers will return to the market," said Len Curran, Renault India vice president, sales and marketing.

Asked whether the recent cut in petrol prices by oil retailers will push up automobile demand, Curran answered in the negative. "It will not have any impact."

(Mithun Dasgupta can be contacted at





Bookmark and Share

Home | Top of the Page


Note: By posting your comments here you agree to the terms and conditions of

Comments powered by DISQUS







Top Stories

Winter session will generate heat for UPA

The Lokpal bill, uncontrolled inflation, corruption... a slew of issues will play out in the month-long winter session of parliament beginning Tuesday and the United Progressive Alliance (UPA) 

NDA allies meet to decide strategy for Parliament's winter session

Every effort to bring Lokpal bill in winter session: Khurshid

Lokpal, food security bill in government agenda for winter session


  Most Read

Teesta Setalvad main accused in exhumation case: Gujarat to SC

Narendra Modi government has justified before the Supreme Court its ongoing probe against social activist Teesta Setalvad in a case of alleged illegal exhuming of bodies of 2002 Gujarat riot victims  

Why Kashmiris want the hated AFSPA to go

Caught in the crossfire between security forces and separatist militants for over two decades, Kashmiris say the government must revoke the controversial Armed Forces Special Powers Act (AFSPA) 

Can Abdullah emerge unscathed from AFSPA logjam?


  News Pick

Islamic banks may double assets in next five years

Islamic banks may be bolstered by a nearly doubling of assets within five years, as borrowers seek alternative methods of financing due to a cutback in 

Written exam to select MNS candidates for polls

Now all aspiring political leaders for the Raj Thackeray-led Maharashtra Navnirman Sena (MNS) will have to prove their mettle by passing exams with flying colours. Aiming to set a trend and do something unprecedented 

Singapore honours Nehru as a 'friend'

Sixty-one years after Jawaharlal Nehru last visited this island state, Singapore commemorates in stone India's first prime minister as a "friend to our shores 

Nehru spirit prevails as Manmohan lands in Singapore


Picture of the Day

The Prime Minister, Dr. Manmohan Singh and the Emeritus Senior Minister, Mr. Goh Chok Tong, unveiled the bust and the Marker of Pt. Jawaharlal Nehru, at Asian Civilizations Museum, in Singapore on November 20, 2011.

(Photo: M. Asokan )



RSS  |  Contact us


| Quick links



Subscribe to

Ummid Assistant






About us




Government Schemes










Contact us





    Disclaimer | Terms of Use | Advertise with us | Link Exchange is part of the Awaz Multimedia & Publications providing World News, News Analysis and Feature Articles on Education, Health. Politics, Technology, Sports, Entertainment, Industry etc. The articles or the views displayed on this website are for public information and in no way describe the editorial views. The users are entitled to use this site subject to the terms and conditions mentioned.

2010 Awaz Multimedia & Publications. All rights reserved.