Domestic passenger car sales grew by only 3.4% last month, the slowest rate of growth in April in 10 years, breaking a string of three consecutive months of record breaking sales.
Car sales stood at 168,351 units during the month against 162,813 units same period last year. It was way off the peak of 229,866 units of March. Entry-level small cars were the worst hit as the increase in excise duty announced in the budget in mid March and the resultant hike in prices began to tell."The market is subdued because of the increase in prices and would need another 2-3 months to adjust to it," said Sugato Sen, senior director, Society of Indian Automobile Manufacturers (SIAM). "The lower end of the market was more impacted, growing by only 0.7%, while mid size sedans grew by 25.0%. Clearly there is one section that is still buying."
Total passenger vehicle sales that also includes utility vehicle, vans and SUVs grew at a faster clip of 9.3% as the availability of diesel vehicles aided growth. Utility vehicles grew by 47.0% as the entry of new products such as Maruti Ertiga and Mahindra XUV5OO brought incremental sales.
Domestic two-wheeler sales grew by 10.9% but presented a picture of contrasting halves. While sale of entry-level motorcycles declined by 3.5%, scooters continued to find favour with urban commuter growing by 30.3% over the last year. It far outstripped the overall motorcycle sales growth of 6.5%.
Exports saw a 1.3% increase even as car exports witnessed a 10.47% slump as demand from overseas markets dried up.