New Delhi, Nov. 10: Passenger car sales fell 6.6 per cent in October — the third time in seven months of this fiscal — as high interest rates and tight consumer credit took their toll.

Sales of trucks and buses were hit harder, suffering a decline of 35.95 per cent at 28,027 units during the month compared with 43,756 units in the same month last year.

According to Tata Motors executive director P. M. Telang, “Commercial vehicle sale is an indicator of economic health.” Lower demand for trucks means slower manufacturing growth.

Industrial output in August, at an annual rate of 1.3 per cent, was the slowest in a decade.

According to data published by the Society of Indian Automobile Manufacturers (Siam), passenger car sales in October fell 6.59 per cent to 98,900 units compared with 1,05,877 units in the same month last year.

For the first time since 2005, car sales contracted thrice in a fiscal year, first in July (down 1.71 per cent), then in August (4.36 per cent) and again in October.

In September the industry reported a sales growth of 2.84 per cent.

Apart from a credit crunch, high prices also dissuaded consumers.

“Commodity prices continue to surge. While the global prices of steel have come down by 30 per cent, the government has imposed a 10 per cent customs duty on them. Banks are also charging high interest rates of 16-18 per cent,” said Vinod Dasari, chief operating officer of Ashok Leyland.

“The situation is going from bad to worse and the industry is likely to register a negative growth rate this fiscal,” he said.

Motorcycles, too, recorded lower sales at 5,38,353 units against 6,57,874 units last year, down 18.17 per cent.