Business – Car sales surge to 6-year high
NEW DELHI: With the economy back on a roll and disposable incomes rising, car sales are soaring. The positive environment saw car sales register
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their highest growth rate in nearly six years in November as sales were up a massive 61%, though a lower base also contributed to the numbers.
According to data released by Society of Indian Automobile Manufacturers, car sales in November stood at 1.33 lakh units in the domestic market, up from 83,121 in the same month last year. Demand has been helped by the surge in the stock markets as well as lower interest rates.
The rise in auto sales on a large scale depended on the launch of new models and lower tax on manufacturing, that was cut as part of government stimulus packages during the peak recession late last year.
Fifteen of the 16 carmakers reported a rise in November sales, Mahindra-Renault being the sole loser with a continued fall in demand for its no-frills sedan Logan. The growth in November sales is the largest increase since a 73% rise in February 2004.
“People are buying new vehicles and there is healthy demand in the market,” said Vaishali Jajoo, automobile industry analyst at Angel Broking. Jajoo said the lower interest rates, higher liquidity and the pick-up in economic activity were leading the charge. “However, we have to remember that the high growth is also due to a lower base,” she added.
Car sales had dipped as much as 19% in November last year when the global recession hit the Indian economy, raising the spectre of massive job losses and pay cuts. Encouraged by the positive numbers, SIAM has said it will be revising upwards its forecast for car sales for this fiscal to double digits.
Two-wheeler sales also remained robust in the month and so was the demand for commercial vehicles, where volumes have been on the up for at 98% in November
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