SIAM lowers car sales growth forecast again to zero per cent
According to SIAM, high interest rate and rising fuel prices are the reason for the lower forecast of car sales this fiscal. This is in spite of car companies registering over 8 per cent growth in December.
Society of Indian Automobile Manufacturers (SIAM) has lowered the growth forecast for passenger car sales to 0 to 2 per cent for this fiscal. However, it expects the whole of auto industry to see a growth of 11 to 13 per cent.
According to SIAM, high interest rate and rising fuel prices are the reason for the lower forecast of car sales this fiscal. This is in spite of car companies registering over 8 per cent growth in December.
SIAM had earlier projected a two per cent growth for this fiscal.
“Small car buyers are seen switching to bikes, which could push two wheeler sales with growth of 11 to 13 per cent,” it said.
Commercial vehicle sales too will grow at 18 to 20 per cent led by high demand for light commercial vehicles, SIAM added.
But, the auto industry as a whole could grow by 11 to 13 per cent, according to the industry body.
The industry also feels that the fall in passenger car sales have also been due to lower output by India's largest carmaker Maruti Suzuki. The auto major had suffered a production loss of 70,000 vehicles caused by labour unrest at its Manesar plant.
But with a slew of new exciting launches this year and interest rates expected to head southwards, there is hope left for passenger car manufacturers.
According to Vivek Mahajan, Head-Research at Aditya Birla Money, the industry could see a growth of 10 per cent in the next financial year.
“Interest rate cuts will benefit the players a lot and a lot of competition is building up with the new car launches,” he said.
