Mid-Size Car Sales Continue To Skid In July

Sales of mid-sized cars slumped in July 1998 over the previous month. While auto companies together sold only 4,324 cars in July as compared to 4,636 the previous month, July sales this year were higher than last July's 4,163 cars.

Initial euphoric sales of Honda's City have dampened: the company sold only 657 cars in July as compared to 1,194 in June. Sales of other mid-sized carmakers, including PAL Puegeot, Hindustan Motors and Tata Sierra/Estate, have been constant at around 150 cars during both months.

The first quarter saw a 6.1 per cent slump in mid-size car sales. Maruti's Esteem, Hindustan Motors' Contessa, PAL Puegeot, Daewoo's Cielo, General Motors' Opel Astra, Mercedes E220, Ford Escort, Honda City and Tata Sierra/Estate together sold 12,180 cars in April-June as compared to 12, 973 cars sold in the same period last year.

Apart from Esteem and City, all other mid-sized car models registered a negative growth in sales during the first quarter.

Esteem managed to retain top position, having registered a 1.4 per cent growth in sales during April-June with 4,575 cars being sold as compared to 4,510 cars sold during the first quarter of 1998-99.

While the Honda City registered phenomenal growth in sales, having sold 2,720 cars during April-June, Opel Astra and Ford Escort took a severe beating. Industry figures suggest that the City may have eaten into the market share of Opel Astra and Fords Escort, both of which recorded sharp declines in sales.

Sales have been affected by hike in excise and other duties. Most car companies have announced price hikes while others are expected to follow suit. Maruti alone has decided to absorb the tax increase.

The second quarter might see a further slackening of sales on account of the price increases, industry analysts said.