Passenger car sales in July lowest in 9 months

At 143,496 units, passenger car sales in July fell to the lowest in nine months, with about half the country’s 18 leading automobile manufacturers reporting declines in volumes. The previous low was October 2011, when sales stood at about 139,000 units.

The decline in volume is despite the 6.7 per cent annual growth in passenger car sales, primarily on account of the low base last year due to labour unrest at Maruti Suzuki’s Manesar unit.

Demand for diesel-powered utility vehicles raised sales of passenger vehicles (which includes passenger cars, utility vehicles and vans) 11.8 per cent to 204,969 units during the month. However, high interest rates, fuel prices and the sluggish demand for petrol cars have made companies wary.

LOW GEAR
Category	Jul-11	Jul-12	% Change
Passenger vehicles	183,339	204,969	11.80
Commercial vehicles	64,237	65,008	1.20
Three-wheelers	43,948	44,286	0.77
Two-wheelers	1,054,120	1,132,696	7.45
Domestic sales only                                         Source : SIAM

Vishnu Mathur, director general, Society of Indian Automobile Manufacturers (Siam), said, “Growth in the passenger vehicle industry was driven largely by demand for diesel-fuelled utility vehicles. But with interest rates continuing to remain high and uncertainty prevailing over resuming operations at Maruti Suzuki’s Manesar unit, sales would take a hit in the coming months.”

In July 2011, sales of passenger vehicles had fallen after three years, owing to disruption in production at Maruti Suzuki’s Manesar facility. On July 8 this year, a violent scuffle between workers and the management at the facility again brought production to a standstill. The company has announced an indefinite lock-out at the facility.