New Delhi, March 10: Domestic car sales grew only 2.3 per cent last month as customers waited for tax sops in the budget to slash prices of vehicles.

According to figures released by the Society of Indian Automobile Manufacturers (SIAM), the passenger car segment, which had managed to beat high interest rates blues so far, recorded a marginal improvement at 94,756 units during the month against 92,618 units in the same period a year ago.

Total domestic vehicle sales in February stood at 7,42,027 units compared with 8,27,594 units in the year-ago period.

However, car makers believe that sales will increase as finance minister P. Chidambaram has cut excise duty on small cars, two and three- wheelers, buses and their chassis to 12 per cent from 16 per cent in his budget on February 29.

Companies such as Maruti Suzuki India, Hyundai Motors India, Tata Motors and Ford have already reduced prices.

“The excise cut will definitely help revive car sales. It is a general practice to buy cars in March after the budget. Therefore, we should see some improvement in the near future,” said Arvind Saxena, vice-president — marketing and sales of Hyundai Motors India.

The automobile industry saw overall vehicle sales drop 10.34 per cent in February, mainly because of a fall in motorcycle sales, which slid 17.68 per cent.

In the passenger car segment, Maruti Suzuki registered a 2.16 per cent growth at 51,762 units against 50,666 units in the same month in 2007.

Hyundai Motors sold 14,591 units during the month against 15,432 units in the corresponding period of the previous year, down 5.45 per cent.

Tata Motors also registered a 16.02 per cent decline at 13,451 units compared with 16,016 units a year ago.

General Motors India had a near three-fold jump in sales with its hatchback Spark continuing a good run.

The company’s overall sales stood at 3,691 units compared with 1,286 units in the same month of the previous fiscal.

The motorcycle segment continued to suffer. It registered a fall of 17.68 per cent at 4,25,089 units against 5,16,410 units a year ago, SIAM said.

According to data compiled by SIAM, Hero Honda Motors registered a sale of 2,47,735 units in February against 2,67,856 units a year ago, a drop of 7.51 per cent.

Ford move

Ford today cut the price of the diesel variant of its compact car Fusion by Rs 22,000.

The company said it was passing on the benefit of the reduction in the excise duty on small cars from 16 per cent to 12 per cent in the Union Budget 2008.

After the price cut, the diesel variant of the Fusion would be available at Rs 6,43,500 (ex-showroom Delhi), it said. The revised pricing will be effective with retrospective effect from March 1, it added.