Saturday, June 02, 2012
By Manoj Kumawat
Weak economic activities take toll on car sales
Maruti Ertiga, Hyundai i20 and new Mahindra Xylo tried their best, Hyundai’s offers on Hyundai i10 and Hyundai Santro also tried to pull crowd but overall passenger vehicles sales have slowed down in May as weak sentiments and hike in petrol prices tamed demand in India. Barring some most of the car companies witnessed dip in sales while the other companies registered growth but insignificant. India is one of the biggest economy but the weak economic activities has hit demand of cars badly. Maruti Suzuki India Ltd. Sales figures of May dipped by 5%, while Ford Motor Co.’s India unit suffered a bigger damage due to slowdown in demand. The May sale of Ford has declined by 15%.
The auto industry experts said that petrol prices hit all time high that has weakened market sentiment. There is a fear among customers that in coming days petrol prices may attain new high as a result, the demand has suffered a major setback. Just like Maruti and Ford, the sales figures of Tata Motors have also fell in May. Tata Indica hatchback sale dipped by 1% and Tata Indigo sedan sale fell by 20%. Overall, sale of Tata Motors Ltd. increased by 6% and the reason being the sales figures of Tata Nano shot up by 31%. Also, General Motors Co.'s sales figures showed a slid of 27% vehicles.
Sources said the growth in Indian economy is slowest since 2003. It has registered growth at 5.3% in January-March quarter. Now, the slow economy growth has taken a toll on car market. At a time when the prices of petrol touched new high, the demand for diesel cars has increased. Diesel is much cheaper than petrol. So the diesel cars are more fuel-efficient. TVS Motor Co., which makes two-wheelers also witnessed drop in sales. The sources said that the TVS Motor Co.’s two-wheelers sale fell 5% and it has sold 1, 76,012 vehicles in May. Besides, Mahindra & Mahindra Ltd sale rose 28% in May, which offer SUV and cars.