New Delhi, March 11: Passenger car sales plunged 26 per cent in February — its worst performance in 12 years — courtesy of falling consumer confidence in a slowing economy, high fuel prices and rising interest rates.
Declining for the fourth consecutive month, sales have come down to 1.58 lakh cars in February according to figures released today by the Society of Indian Automobile Manufacturers (Siam).
In stark contrast, sales grew 13.11 per cent to 2.13 lakh cars in the corresponding period a year ago.
According to Siam’s report, with just a month left for the financial year to end, sales growth would be in negative territory in 2012-13, the first contraction since 2002-03.
“The decline in car sales in February was the largest since December 2000, when sales declined by 39.86 per cent. The market continues to be extremely difficult as high fuel prices, interest rates and overall macro economic factors are adding to low consumer sentiments,” Siam deputy director-general Sugato Sen said.
In February, Maruti Suzuki India posted a decline of 10.89 per cent at 83,865 units against 94,118 units in the same month last year.
Sales of the company’s small cars such as the Maruti 800, A-Star, Alto and WagonR fell 15.87 per cent to 41,311 units during the month from 49,104 units sold in February 2012.
The compact segment comprising the Estilo, Swift and Ritz models saw a 14 per cent decline in sales to 24,021 units. However, it’s Swift DZire proved to be a moneymaker with sales of 18,316 units, a 21.56 per cent increase in February.
Rival car maker Hyundai Motor India also saw a 7.42 per cent decline in sales to 33,936 units in February compared with 36,658 units a year ago.
Tata Motors was one of the worst hit, with domestic sales declining three-fold to a mere 7,769 cars.
According to Sen, the budget for 2013-14 had some positives for the overall sector but higher taxes on sports utility vehicles (SUV) have come in as a dampener.
“The feedback we have received from the companies is that in the next three-four months they don’t see any significant improvement, even new models are unlikely to lift the sentiments. They are, however, optimistic that in the second half of the year sales may again pick up,” Sen said.
All eyes are on sales in March, which usually are the highest for the year.
However, Sen said, sales till February for the fiscal are down 4.6 per cent and it will be very difficult for the industry to regain the lost ground in March to meet the annual target of 0-1 per cent growth.
The motorcycle market fared no better as domestic mobike sales declined 4.48 per cent to 8,00,185 units from 8,37,743 units in the same month last year. Hero MotoCorp, the largest player, posted a decline of 7.13 per cent at 4,36,954 units. Bajaj Auto also saw its sales drop 12.4 per cent to 1,78,632 units during the month.
However, Honda Motorcycle and Scooter India (HMSI) posted a growth of 30 per cent at 97,684 units.
Total two-wheeler sales in February 2013 declined 2.77 per cent to 11,12,289 units from 11,43,982 in the same period a year ago.
Siam, however, said scooter sales were in the positive territory with a growth of 2.55 per cent in February this year at 2,43,346 units against 2,37,306 units in the same month last year.
HMSI saw a decline of 4.02 per cent in its scooter sales in February this year at 1,17,460 units. Hero MotoCorp, however, saw its scooter sales grow 31.9 per cent to 51,976 units. TVS Motor Co posted a decline of 15.97 per cent in its scooter sales at 29, 237 units.