New Delhi: Car sales in India grew at the slowest pace in seven months during May with industry body SIAM today reporting 2.78 percent growth as high interest rates and petrol prices continue to hit the market.
According to figures released by the Society of Indian Automobile Manufacturers (SIAM), domestic car sales in May stood at 1,63,229 units as against 1,58,809 units in the same month last year.
"This is the slowest growth since October last year when car sales witnessed a decline of 23.77 per cent," SIAM Director General Vishnu Mathur told reporters here.
"The softening of interest rates, which was expected to happen has not materialised and continues to be high. Moreover, the high prices of petrol have also affected sales and the overall sentiment in the market is very negative," he added.
Increase in prices of vehicles following the excise duty hike in the Budget has also had a major impact, Mathur said, adding that even diesel vehicles which used to have a lot of demand had tapered off.
"In the premium and executive segment, which are generally considered to be not price sensitive, the demand for diesel vehicles has slowed down," Mathur said.
At such a time, he added, "if the government goes ahead and decides to tax diesel vehicles more, the overall demand will suffer all the more".
In the passenger car segment, market leader Maruti Suzuki's sales dipped by 5.94 per cent to 72,309 units.
However, rival Hyundai Motor India's sales increased by 3.03 per cent to 31,939 units. Homegrown auto major Tata Motors' car sales were up by 6.70 per cent at 17,371 units.
In May, total sales of vehicles across categories registered an increase of 10.52 per cent to 15,13,032 units as against 13,69,070 units in the same month last year.
Total two-wheeler sales last month increased by 11.40 per cent to 11,92,688 units from 10,70,603 units in May 2011.
According to the SIAM data, motorcycle sales in the country grew 7.24 per cent during the month to 8,87,634 units from 8,27,746 units in the same month last year.
In this segment, market leader Hero MotoCorp posted 10.68 per cent jump in sales to 5,02,676 units in May.
However, rival Bajaj Auto's sales went down by 5.30 per cent to 2,06,751 units during the month.
Honda Motorcycle & Scooter India (HMSI) posted a 45.45 per cent increase in sales to 88,334 units, while TVS Motor moved 47,175 units, 14.47 per cent less than the corresponding month of the previous year.
The scooter segment's overall sales grew 34.40 per cent to 2,35,185 units from 1,74,985 units.
Source: PTI
