Indian Economy News

April car sales up 18%, fastest in 30 months

New Delhi: Domestic passenger car sales got off to flying start in 2015-16 by clocking 18.14% growth in April, the fastest in the 30 months, boosted by improved consumer sentiment over softer fuel prices and new models.

Industry body Society of Indian Automobile Manu­fac­tu­rers (Siam) said car sales stood at 159,548 units during the month, against 135,054 units in April 2014. It was the seventh straight month of growth for the industry, and the fastest year-on-year since October 2012, when it grew 21.19%. However, Siam cautioned that a complete turnaround would take some more time.

“We have started the new fiscal with growth in all segments except three,” said Vishnu Mathur, director general, Siam. Sales of three-wheelers, motorcycles and light commercial vehicles dipped.

Mathur highlighted that the automobiles sector was still in recovery mode, and said, “We will say we have fully recovered only when we reach the peak levels. We are far away from that as of now. Currently, not all companies are showing growth.”

Sale of SUVs and multipurpose vehicles grew at a sedate 7%, while vans logged a nearly 20% growth. Sale of commercial vehicles grew by 6.5% largely on the back of a 24% jump in sales of heavy trucks and buses that is considered a barometer of the state of the overall economy.

The unseasonal rains in parts of north India two months ago continued to haunt the two-wheeler industry as sale of motorcycles slid 2.3% due to the impact on farm income. With the Met predicting a below-average monsoon this year, the two-wheeler industry may have a rough ride in store.

“The decline in motorcycle sales is a reflection of the impact of unseasonal rains in the rural market. We will have to watch out for how deficient rains will affect us going forward,” Mathur said.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.