Backed by stimulus steps, auto sector posts marginal growth

April 8th, 2009 - 6:27 pm ICT by IANS  

New Delhi, April 8 (IANS) India’s auto industry, which was hit hard by the global financial crisis that started in mid-2008, ended last fiscal with a marginal 0.7 percent growth in sales, thanks to the government’s stimulus measures.
The auto makers sold 97,23,391 vehicles in 2008-09, up from 96,54,435 units the year before, data released Wednesday by the Society of Indian Automobile Manufactures (SIAM) said.

Total passenger car sales rose 1.31 percent to 12,19,473 units last fiscal from 12,03,733 vehicles in 2007-08, while the two-wheeler segment sold 58,35,145 units as against 57,68,342 units, posting a rise of 1.16 percent.

The SIAM, however, remained hopeful of achieving higher growth in the current fiscal.

The passenger vehicle segment is expected to grow 3-5 percent in 2009-10, while the commercial vehicle sector, which slumped 21.7 percent in 2008-09, will likely see 5-7 percent growth, the industry lobby said.

“Smaller towns and cities will contribute to the growth of the passenger vehicle segment with the stimulus packages increasing bank lending,” SIAM director general Dilip Chenoy told reporters.

He attributed the slight annual growth in auto sales, which plummeted for seven consecutive months between June and December 2008, to the stimulus measures adopted by the government.

“Had there not been the stimulus packages, the passenger vehicle sales would have been down three percent, while the commercial vehicles sales would have had a decline of 30-40 percent,” Chenoy said.

Passenger vehicle sales slumped 1.15 percent in March 2009 and the commercial vehicle segment continued with its poor run with 26.2 percent drop, while the two wheeler segment grew 3.65 percent, SIAM added.

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