Vehicle sales in Oct dip 14.42 percentNovember 10th, 2008 - 9:44 pm ICT by IANS
New Delhi, Nov 10 (IANS) Vehicle sales in October declined by 14.42 percent as compared to sales in the same month last year, according to the monthly report of a leading industry lobby released here Monday.October is a festive month in India when vehicle sales tend to shoot up as people make their big ticket purchases at this time of the year as many employers pay Puja or Diwali bonuses to their employees at this time.
This year, however, vehicle sales dipped by 14.42 percent in October, the report prepared by industry lobby Society of Indian Automobile Manufacturers (Siam) said.
The report said: “In October this year, 865,404 vehicles were sold against 1,011,221 in the corresponding month last year, with domestic passenger car sales at 98,900 against 105,877 units sold in the corresponding month last year.”
The report said motorcycle sales were at 538,353 units as against 657,874 units last year, while commercial vehicles sold stood at 28,027 units as compared to 43,756 units in October last year.
“Whatever steps that were taken up by the government and the Reserve Bank of India (RBI) to ease the liquidity crunch are not sufficient. They have been used up to correct existing problems in the system and it has not trickled down to the auto industry,” said Siam Director General Dilip Chenoy.
The RBI is India’s central bank which had recently cut two key reserve ratios to inject more than Rs.600 billion liquidity into the banking system.
As a result of the liquidity crunch, bank financing for vehicle purchases has all but dried up affecting sales.
Chenoy said: “Financing is still a big issue for the auto industry and we are keeping a watch till the end of this month to forecast what growth the industry can achieve this fiscal.”
Siam had earlier predicted an overall sales growth of 12 to 15 percent this year.
Siam said Hero Honda’s scooter sale was up by 35.21 percent at 16,359 units as against 12,099 units last year, while TVS Motor’s scooter sales were down by 21.40 percent to 21,043 units as against 26,771 during the same period.
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