Car sales grow slowest in May 2012

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. 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 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.

Commercial vehicles sales grew by 9.12 per cent to 62,025 units during the month, from 56,841 units in the year-ago period, SIAM said. Medium and Heavy Commercial Vehicle sales declined 10.58 per cent to 22,227 units during the month compared to 24,858 units in May last year. According to SIAM, light commercial vehicle sales grew 24.43 per cent to 39,798 units in May 2012 from 31,983 units in May 2011. In the three-wheeler category, sales fell by 3.32 per cent to 37,184 units from 35,988 units in the same month last year.