On February 2nd, Tata Motors,
India's largest automobile
maker and third largest car manufacturer, revealed that it sold
9% less car units than the 20,119 units it sold in the corresponding period of
the previous year. Sales of Indica, its flagship car model, stood at 11,433
units, 7.5% less than its January 2008 figures. "Faint signals of the impact of
the financial stimulus announced by the government, particularly for
commercial vehicles, is being noticed. However the automobile market continues to
be under the grip of a credit squeeze and high interest rates", the company
said in a statement. Hyundai Motor India, India's second largest carmaker, too
reported a decline in sales, albeit in double digits at 21,015 cars, while
premium carmaker, Honda Siel Cars registered a plummeting 26% fall in
January sales at 5,773 vehicles. In fact, on the whole, except the market
leader, Maruti Suzuki, which notched a sales growth of 8.6% to 59,060 cars,
the industrywide car sales fell 3.2% year-on-year to 1.10 lakh cars in
January, this year. January sales figures only extend the poor run of the
domestic carmakers, who struggled with sloppy sales during the first nine months
ending December 2008.
Indeed, the slide began much earlier than many thought. According to
the data by the Society of Indian Automobile Manufacturers (SIAM),
beginning July 2008, sales have fallen for five of the last six months, with the
exception of September when manufacturers pushed stock to dealers in
anticipation of a spurt in demand during the
festive month of October. In fact, as per the SIAM statistics, the sales in the
passenger vehicles segment registered de-growth with (-) 0.46 growth
during April-December 2008 over April-December 2007, while sales of
passenger cars fell 0.28% during the said period. And the fall continues. Car sales in
the domestic market head south, despite the two stimulus package announced
by the government in recent times. Besides, even the series of measures
initiated by the manufacturers, such as discounts, lower interest rates, and
freebies, have so far failed to lift the sentiments of prospective buyers who
are concerned by sluggish economic growth and a weak job market
scenario. Tighter credit market too has played the spoilsport as banks have been
reluctant to lend or are asking higher margin money, thus discouraging the
potential buyers. |
