New Delhi, Aug. 12: Sales of sports utility vehicles (SUVs) slumped for the first time in almost 50 months in July owing to higher duties and rising diesel prices.
Analysts said the economic slowdown, high interest rates, costlier fuel and poor market sentiments continued to hurt demand, although launches such as the Honda Amaze and the Ford EcoSport brought some excitement.
According to the Society of Indian Automobile Manufacturers (Siam), sales of SUV/UV fell 17.5 per cent to 37,010 units from 44,878 in July last year.
This is the first time sales in this segment have fallen since May 2009 when it dropped 29 per cent.
“Such a fall can happen only because of a trigger, which was an increase in excise tax,” Siam director-general Vishnu Mathur said.
The country’s biggest SUV maker such as Mahindra & Mahindra had to jack up prices after the Centre raised the excise tax on SUVs by 3 per cent to 30 per cent.
Moreover, compact SUVs such as the Renault Duster and Ford EcoSport ate into the sales of the market leader. M&M sold only 15,531 units in July against 22,011 in the year-ago period, a drop of 29 per cent. Sales of utility vehicles fell 9 per cent to 75,754 units.
Passenger car sales fell for the ninth consecutive month in July by 7.4 per cent, Siam said, adding that the auto sector has started retrenching temporary workers.