| GREATER NOIDA, India
GREATER NOIDA, India Feb 11 Car sales in India
fell 7.6 percent in January, the fourth straight month of
decline, according to figures released by the Society of Indian
Automobile Manufacturers (SIAM), in a market set to fall for the
second straight year.
Car sales fell to 160,289 vehicles Last month, the industry
body said, as consumers kept a tight lid on spending, hurt by
high interest rates and fuel costs in a slowing economy.
Sales have fallen 5.2 percent so far this fiscal year that
ends in March.
"There is no respite," said Sugato Sen, SIAM's deputy
Sales of passenger vehicles, which include cars and utility
vehicles, fell 9.3 percent in January.
Utility vehicles were a bright spot in the auto market a
year ago, but an increase in factory gate duties and rising
prices of diesel, which is commonly used to power such vehicles,
has hit their sales as well.
Sales of motorcycles rose 4 percent last month to 922,323,
while commercial vehicle sales were down 20.9 percent at 49,987,
SIAM said. Demand for trucks and buses has been hit hard as
industrial production and economic activity slows.
The volume decline in passenger and commercial vehicles,
which started in the second quarter of fiscal 2012, may continue
in the fiscal year that starts in April, India Ratings &
Research, a unit of Fitch Group, said in a recent note. However,
the volume growth rate may turn positive after September, it
Demand for cars has fallen, particularly in urban areas,
with the economy growing at its slowest pace in a decade.
Still, consumers in rural areas, where incomes are being
partly boosted by strong monsoon rains, are helping some
companies such as Maruti Suzuki, the country's top
carmaker, offset the slowing sales.
While there are no signs of an immediate recovery, the auto
industry is hoping that the government may cut factory gate
duties when it presents the interim budget, Sen said.
Finance Minister P. Chidambaram is widely expected to
announce measures, including a cut in factory gate duties on
some products, to push up manufacturing output when he presents
an interim budget for the coming fiscal year in parliament on
Automakers are also betting that pent up demand and new
vehicle launches, many of which were unveiled at the ongoing
auto show in the outskirts of New Delhi, will help boost sales,
especially after a general election due by May.
(Writing by Aradhana Aravindan; Editing by Kim Coghill)