SIAM passenger car sales fall for the sixth straight month

In the longest stretch in over 16 years since SIAM first started collating data, car sales have stayed in the negative zone

Passenger car sales in the domestic market declined for the sixth straight month in April as sluggish economic activity, high financing costs and fuel expenses kept away customers from showrooms.

This is the longest stretch in over 16 years, since industry body Society of Indian Automobile Manufacturers (SIAM) first started collating data in the financial year ended March 1998, that car sales have stayed in the negative zone. In April passenger car sales dropped by 10.43% to 150,789 units.

Sugato Sen, deputy director general, SIAM, said, "High cost of ownership is affecting car sales, which have been dropping since November last year. This is the longest period in which car sales have posted continuous decline since we started analyzing data in 1997-98.”

The rate of decline in car sales for April this year at 10.43%, in fact, is the highest since 2002, when it fell by 22.82% in the same month.

With correction in fuel prices setting in, however, Sen said entry-level car buyers have started returning to the showrooms. "Though the decline in sales is expected to continue for about the next two months there are some positive signs. We may see some growth as buyers of entry level small cars have started coming to showrooms after rice corrections on the fuel front”, Sen added.

Overall, passenger vehicle sales fell by 8.21% to 208,386 units last month as compared to 227,037 units sold in the year-ago period. Volumes were dragged down as even sales of utility vehicles, which had grown by a strong 52% in FY13, grew only by 3.99% to 40,563 units in April.

During the month while market leader Maruti Suzuki posted marginal growth of 0.30% to sell 90,523 units, rival Hyundai Motor India Limited (HMIL) reported a drop of 7.60% at 32,403 vehicles. Overall, nine of the sixteen leading passenger vehicle manufacturers registered a drop in sales numbers.

According to data released by SIAM, motorcycle sales in April declined by 2.06% to 8,43,889 units from 8,61,608 units in the same month previous year. Sales of scooters, however, increased by 14.72% to 261,475 units.

Category	April 2012	April 2013	% Change
Passenger Vehicle	227,037	208,386	-8.21
Commercial Vehicles	56,257	56,678	0.75
3 wheelers	32,044	34,348	7.19
2 wheelers	1,157,114	1,168,080	0.95
Total	1,472,452	1,467,492	-0.34
Source: SIAM

SIAM said total two-wheeler sales in April 2013 grew by 0.95% to 1,168,080 units from 1,157,114 units in the same period of previous year.

Interestingly, sales of commercial vehicles which have been registering a drop since November last year grew marginally by 0.75% to 56,678 units in April.

Total sale of vehicles across categories registered a decline of 0.34% to 1,467,492 units in April 2013 against 1,472,452 units in the same month last year.