Car sales zoom 46% in Feb

Riding on the back of lucrative discounts and buoyant demand, partly fuelled by portends of price increase in mid-March, car sales grew by a robust 46.5 per cent last month to 92,594 units, according to Society of Indian Automobile Manufacturers, the industry body.

In contrast, motorcycle sales grew by only 4.93 per cent to 5,16,410 units. The buoyancy in passenger cars is unusual for February, a month in which car sales often remain lukewarm in expectation of sops that the Union Budget may announce.

The sales stood at only 63,213 units last February, when customers had postponed purchases in the run-up to the widely-expected excise duty cut on small cars "" it was reduced from 24 per cent to 16. Small cars that qualify for the lower excise "" Alto, Santro, Indica diesel, Swift diesel, Wagon R and Zen Estilo "" sold 68,900 units, 70 per cent of the total, in February this year.

Analysts, however, point out increased sales of bigger mid-segment cars in February, reflecting the growing preference of the Indian consumer for larger cars regardless of the higher price. Sales of the A3 segment cars increased by 39 per cent in February to 2,225 units against 1,604 units in the same month last year.

"Indian customers are moving towards mid-segment cars "" Honda City, Ford Fiesta, Chevrolet U-VA, Hyundai Verna, etc, which are steadily making their presence felt on Indian roads," said Arvind Jain of Religare Securities.

Passenger car market leader Maruti Udyog Ltd continued its good run, clocking a 57 increase in sales to 50,666 units against 32,259 last February. Hyundai posted a sales increase of 76 per cent to 15,432 units, compared with 8,780 last February. Tata Motors, though second in terms of monthly sales, posted a 13 per cent increase to sold 16,016 units against 14,200 units in February last year.

The single digit growth in motorcycles was on account of Bajaj Auto's sales plummeting 7 per cent to 1,46,642. Market leader Hero Honda's sales grew 11 per cent to 2,67,856 units.

"The two wheeler industry is witnessing some transition with production facilities being shifted to other locations and companies changing their product portfolios. With the new facilities of all three major two-wheeler companies coming up in the tax-free regions in another quarter, the position is expected to stabilise and more consistent sales expected in future," a senior SIAM functionary said.

The commercial vehicles also posted a strong growth and grew at 36.12 per cent in the same period. The growth of medium & heavy commercial vehicles was 36.74 per cent, while the light commercial vehicles recorded a growth of 35.25 per cent.