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Car sales drop steeply in May; Maruti volumes crash 13%

Passenger car sales plunged in May, the seventh consecutive month of decline, indicating that consumer sentiment still remains low on the back of uncertainty on macro-economic growth, rising diesel fuel prices and high interest rates.

Passenger car sales plunged in May, the seventh consecutive month of decline, indicating that consumer sentiment still remains low on the back of uncertainty on macro-economic growth, rising diesel fuel prices and high interest rates. Car makers and industry experts expect growth to only return in the second half of the fiscal, starting with the festive season around September.

The steep drop in sales was precipitated by market leader Maruti Suzuki, which saw domestic volumes drop 13% at 77,821 units in May. In a first, sales fell for all its diesel models ? the Dzire, Swift and Ertiga, though mini cars like Alto and WagonR saw a growth of 5% on the back of rising demand for petrol cars over the past few months.

Hyundai saw a flat growth, maintaining volumes at 32,102 units on strong sales of the Eon, i20 and Verna, while exports ? it?s the biggest car exporter form India ? were up 4.6% at 24,754 units. Tata Motors continued the sales decline of the past months, recording a 46% drop in volumes in May at 11,135 units.

Hyundai Motor India senior VP (sales and marketing) Rakesh Srivastava said, ?Hyundai has been able to maintain a positive growth and will gain market share as demand for petrol cars

is improving.?

Mahindra & Mahindra, which had outperformed the industry in FY13 on the strong demand for its diesel-powered utility vehicles (UVs), saw a continued moderation in sales in May. Volumes in the month were up 5% for the Mumbai-based UV specialist at 22,244 units, as demand for diesel cars slowed down on rising fuel prices and a recent increase in excise duties on SUVs made most of its vehicles more expensive.

Mahindra & Mahindra CEO (automotive) Pravin Shah said, ?The growth in capital investment and private spending has also slowed down, which is a cause for concern. We hope new product launches will rev up growth.?

Toyota Kirloskar saw sales drop by 35% to 10,023 units. However, some companies like Renault, General Motors (GM) and Honda were able to buck the trend largely on the back of successful new launches. For Renault, the Duster continued to drive sales ? it sold 5,146 units in May, which represented 82% of the company?s 6,300 units total volumes in the month.

GM also saw new launches like the Sail sedan and Enjoy MPV drive sales up 40% in the month to 8,500 units, while the strong success of Honda?s first diesel car in India, the Amaze, sold 6,036 units in the month, led the Japanese carmaker post its highest-ever domestic sales at 11,342 units (growth of 10%).

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First published on: 02-06-2013 at 01:03 IST
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