Festive season failed to cheer car companies as domestic sales declined by 3.88 per cent in October as high interest rates and fuel prices continue to affect consumer sentiments snapping a two-month streak of positive growth.
Motorcycle manufacturers, however, had reasons to celebrate in October, posting the highest sales volume in a single month since industry body SIAM started collating data in 1997-1998, riding on strong rural demand.
SIAM said motorcycle sales in October grew by 18.05 per cent to 11,05,103 units from 9,36,122 in the same month of the previous year while domestic passenger car sales in October stood at 1,63,199 units as against 1,69,788 in the same month last year.
“We continue to see a decline in car sales. In today’s economic scenario of high inflation and interest rates, the middle class (the major customers of cars) is the worst hit,” SIAM Director-General Vishnu Mathur told reporters here.
He, however, said the positive spark during the festive season was the demand coming from the rural market following a good monsoon, which resulted in some traction of small cars.
“This is the only reason for the moderation in decline in car sales, otherwise the slide would have been much steeper,” he added.
Car sales in India declined for a record nine months till July this year but grew in August and September.
In October, market leader Maruti Suzuki India posted a marginal decline in domestic sales at 79,040 units, while rival Hyundai Motor India saw its sales grow marginally to 35,973 units.
Homegrown auto major Tata Motors’ domestic passenger car sales crashed by 33.44 per cent to 10,944 units in October. Mahindra & Mahindra saw its utility vehicle sales down by 13.18 per cent to 22,034 units during the month.