Car Sales Record May Fall This Year

By By: Vicky.in

Published: Thursday, February 10, 2011, 16:01 [IST]

The factors like easy loan, increased purchase power and range of vehicles made the imminent increase in car sale during January 2011. The car sales hit a record figure to 31% and the country has been one of the most potential market for the global players. However, the car sale is expected to witness a downfall during this year by 15% due to interest rates increase and fuel price hike as well as the overall increase of the vehicles. An analyst of the stock broking said the situation is slightly changing now from what it had been for two years. He however, projected a rise of 10-15% in this year amidst inflation rate hike.

He parallels the growth rate of car sales in the US which is the second largest market in the world and has seen the 11% growth in 2010 after a 4-year recessive downfall. Auto industry is the third largest economy in India with a 9% growth made possible mainly by increased domestic demands and is to go for some more time now. The sale volume for January 2011 was 184332 units marking a rise of 26.3% against the one achieved in the same period of 2010, said SIAM. There was an increase of 12.6% with sale of 60,753 units in trucks and buses and the reason cited for this was the wait for the January from December 2010 units. However, the rate of sale volume was still low, felt the industry analysts.

The top most car company Maruti got 14.7% rise in its January car sale which was the slowest in its sale since March last. Tata motors had to face tough phase with its Nano which it recovered in January courtesy various offers on purchase and services. Ultimately the company posted a rise of 15% in this month while Mahindra got a rise of 22% against its volume of the same period of 2010. The industry faced crisis due to the revised interest rates mooted by the financial institutions in the last year. The move affected the prospects of the auto industry and the realtors. SIAM expressed its fears over the further increase in interest rates out of the ensuing budget. The government is expected to effect a rise of 2% in this budget to compensate the loose fiscal policy for recovery of crisis.

Article Published On: Thursday, February 10, 2011, 14:21 [IST]

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