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Car sales grow 28.4% in July

Analysts attribute this growth to excise duty cut on small cars, rising disposable incomes and a cyclical demand upsurge.

india Updated: Aug 08, 2006 20:45 IST

Car sales in the domestic market showed a second consecutive month of high demand with a 28.4 per cent rise at 81,038 units while a rare blip in sales of Hero Honda saw motorcycles achieve a modest growth of 13.3 per cent.

According to figures released by Society of Indian Automobile Manufacturers, as many as ten of the 11 car makers, including Maruti Udyog, Hyundai, Tata Motors, Ford and General Motors, registered a healthy growth in demand. However, Toyota Kirloskar saw numbers fall as sales stood at 509 units in July against 549 units in the same period last year.

Car sales in the first four months of this fiscal have grown 24.8 per cent at 3,24,671 units against 2,60,025 units in April-July 2005, SIAM said.

Analysts attribute this growth to the eight per cent excise duty cut on small cars in this year's budget, high economic growth, rising disposable incomes and a cyclical upsurge in demand that had shrunk to single digits last fiscal.

However, hardening of interest rates as well as rise in costs of input materials for cars is a source of concern for the industry, analysts pointed out.

On the two-wheeler front, motorcycles continued their healthy run despite a marginal two per cent decline in numbers of segment leader Hero Honda where sales fell to 2,18,515 units against 2,23,150 units in July 2005.

Propped up by Bajaj Auto, TVS Motors and Yamaha India, bike sales were up 13.3 per cent in July at 4,53,152 units against 3,99,778 units in the same month last year.

In the scooter/scooterettee segment, nearly four-fold rise in sales of Honda Motorcycle and Scooter India saw numbers go up by 37.5 per cent in July at 76,495 units against 55,627 units in the corresponding month last year.

Overall two-wheeler sales in the month, comprising mopeds, scooters and bikes, were up 15.3 per cent at 5,57,466 units against 4,83,089 units in July 2005.

On the commercial vehicles side, sales were up 37 per cent in the domestic market in July at 32,647 units against 23,827 units in the same month last year. This was boosted by higher numbers of Tata Motors and Ashok Leyland, the segment heavyweights.

In the medium- and heavy-commercial vehicles segment segment, sales were up 41 per cent 19,144 units against 13,566 units as goods carriers saw a healthy growth in demand. On the light commercial vehicles side, the numbers were up 31.5 per cent at 13,503 units with Tata Motors dominating the segment.

Commercial vehicle sales in the first four months of the fiscal were up 40.7 per cent at 1,28,516 units against 91,032 units in the same period in 2005-06, SIAM said.

On the three-wheeler side, sales were up 19.2 per cent in July in the domestic market at 34,587 units against 28,902 units in the same month last year. While sales in the passenger carriers segment were up eight per cent at 20,288 units, goods carrier numbers were up 40 per cent at 14,299 units.