LOSING SPEED At 3.4%, April car sales at 10-yr low

Price Hikes And High Interest Rates Hit Entry-Level Segment The Most

New Delhi: Passenger car sales in India witnessed slowest growth during April in 10 years at 3.4% as customer sentiment remained low due to post-Budget price hikes and high interest rates, affecting the entry-level segment most in the country. 

    According to figures released by the Society of Indian Automobile Manufacturers (SIAM) today, domestic passenger car sales stood at 1,68,351 units in April 2012 compared to 1,62,813 units in the same month last year. 

    "The growth in last month was sober, it is the slowest for April in the last 10 years. The price hike that was done after the excise duty was raised in the Budget and high interest rates have affected consumers' sentiment," SIAM Director General Vishnu Mathur told reporters here. 

    In April 2002, the auto industry had saw passenger car sales falling by 22 per cent, he added. "The volume-driven small car segment is the worst hit in April with just 0.68% rise. This segment is very price sensitive and slightest alterations impact it," Mathur said. 

    The market will take some time to absorb this price hike that has affected other sectors also. In the Budget 2012-13, the government had hiked excise duty by 2 percentage points to 12% that every automobile manufacturers passed on to customers. Besides, different duties were raised depending upon the vehicles' engine and size specifications. 

    Total sales of vehicles across categories registered an increase of 10.01% to 14,72,385 units in April as against 13,38,430 units in the same month last year. 

    "Overall growth in the industry was subdued. The first six months are going to be tough because if we expect any industry-friendly monetary policy, then it will happen in the second half only," Mathur said. 

    In the passenger car segment, market leader Maruti Suzuki's sales dipped by 1.31% to 72,939 units. However, rival Hyundai Motor India's sales increased by 10.75% to 35,000 units. Homegrown auto major Tata Motors' passenger car sales were down by 4.78% at 18,610 units. 

    Total two-wheeler sales last month increased by 10.94% to 11,57,108 units from 10,43,010 units in April 2011. 

    According to the SIAM data, motorcycle sales in the country grew 6.54% during the month to 8,61,602 units from 8,08,728 units in the same month last year. AGENCIES