Weak demand saw the domestic automobile industry’s sales drop by a little over 5 per cent in February against the same month last year.
Passenger car sales were the worst hit, declining by nearly 26 per cent, according to data released by Society of Indian Automobile Manufacturers (SIAM) on Monday. This was the sharpest fall reported in the last 12 years. The last such drop was in December 2000, when sales declined by 40 per cent.
“The market continues to be extremely difficult as high fuel prices, interest rates and overall macroeconomic factors are adding to low consumer sentiments,” Sugato Sen, Deputy Director-General, SIAM, said.
With a just few days left for this fiscal year to end, the industry body said it was certain that car sales would decline this year, the first decline since 2002-03. In the two-wheeler segment, while motorcycle sales declined by 4 per cent, scooter sales grew by 3 per cent.
Three-wheelers sales grew by 5 per cent during the month.
Commercial vehicle sales were hit, reporting a 11 per cent decline.
On the outlook, Sen said, “Usually, the last month of the fiscal sees the highest sales. Even if that were to happen, we are unlikely to meet our forecast of a growth of 0-1 per cent as we are down by 4.64 per cent in the April-February period this year.”
“The feedback we have received from the companies is that in the next three-four months they do not see any significant improvement, even new model launches are unlikely to lift the sentiments,” he said