Passenger car sales in India grew by a mere 3.40 percent in April, the slowest in 10 years, as high interest rates and rising fuel prices hit offtake of entry-level models that fell by 17.45 percent from the like period of 2011.
According to the data furnished by Society of Indian Automobile Manufacturers (SIAM), total passenger car sales stood at 168,351 units from 162,813 units sold in the corresponding period of 2011.
The sales of entry-level such major passenger cars as Santro, Eon, Alto and Wagon R fell over 17.45 percent at 44,381 units from 53,764 units in the like period of 2011.
Entry-level cars are one of the main growth engines for the industry in the sixth largest car market in terms of volumes.
SIAM said the highly cost-sensitive industry, which is dependent on financing and equitable operating cost, was marred by interest rates and fuel costs which dampened consumer sentiments across segments.
"High interest rates, fuel cost and inflation have dented the entry-level sales of cars," a senior official with SIAM said.
"We expect the sales to pick in the second half of the year, which is also the start of the festive season."
In April 2002, the industry had seen passenger car sales falling by 22 percent, SIAM director general Vishnu Mathur told reporters here.
Even sales of entry-level motorcycles like Hero MotoCorp's CD Dawn, Splendor, Bajaj Auto's Boxer, Discover and TVS's Victor also dipped by 3.48 percent at 548,465 units from 568,272 units in the corresponding period of 2011.
Passenger car exports also dwindled due to weak global buyer sentiments in April, which fell 10.45 percent to 37,676 units from 42,073 units shipped out in the corresponding period of 2011.
The total domestic passenger vehicle sales, including those of cars, utility vehicles and vans, grew 9.30 percent in the month under review at 227,034 units from 207,724 units in the like period of last year.
Exports of passenger vehicles, including cars, utility vehicles and vans, was down by 10.47 percent at 38,178 units from 42,643 units shipped put in April 2011.
However, domestic two-wheelers, including motorcycles, scooters and mopeds, sales during the month rose by 10.94 percent to 1,157,108 units from 1,043,010 units. Motorcycle sales went up by 6.54 percent at 861,602 units.
Commercial vehicle sales, including those of light commercial vehicles and heavy commercial vehicles, a key economic activity indicator, rose by 4.37 percent to 56,257 units in April from 53,903 units in the previous corresponding period, SIAM said.
Total sales across categories grew by 10.01 percent to 1,472,385 units in the month under review from 1,338,430 units in the corresponding period of 2011.
Exports across categories increased by 1.29 percent at 265,553 units from 262,172 units which were shipped out in April 2011.