Passenger vehicle sales in the domestic market soared to a record high last month, as buyers advanced their purchases to avoid price hikes after the government announced an increase in excise duty, registration tax and value-added tax in the Budget.
Ten of India’s 19 leading automobile manufacturers sold 18 per cent more vehicles at 270,441 units, compared to 228,793 units in March 2010. This was the highest growth rate since April 2011, when sales rose 14 per cent.
Buoyed by demand in the domestic market, Maruti Suzuki India Ltd, Tata Motors, Mahindra & Mahindra, Honda Siel Cars India and Volkswagen all closed 2011-12 with record sales numbers.
While Maruti Suzuki recorded an off-take of 112,724 vehicles in March, to close the year with sales of over a million units, Tata Motors rode high on small cars Nano and Indica. Its volumes grew by a third to 36,984 units in March. Nano sales rose 20 per cent to 10,475 units.
Though the entry-level segment did not favour the market leader, Maruti Suzuki, as much, its sales increased by 2.1 per cent on robust demand for new launches — premium hatchback Swift and sedan DZire. Sales of small cars M800, Alto, A-Star and WagonR declined by 10 per cent to 52,826 units during the month.
New cars bailed out Toyota Kirloskar and Honda Siel from the sluggishness in the market. Sales grew twofold for Honda in March, with new entrant Brio accounting for nearly 60 per cent of its overall volume. For Toyota, sedan Etios and hatchback Liva brought in 50 per cent of the tally. General Motors saw its best-ever monthly sales for Beat at 5,638 units. A diesel version of Beat was introduced in June last year.
Despite the strong numbers, car companies are cautious about the turnaround and the sentiment in the market. Arvind Saxena, director (marketing and sales), Hyundai Motor India Ltd, said, “We could meet our expectations in March, as there was considerable interest to beat the expected price hike in the Union Budget. The market continues to pose many challenges. Things can improve if interest rates come down this quarter.”
The Korean auto maker’s sales grew by 22 per cent to 39,122 units last month. Exports saw a dip of 15 per cent at 20,107 units, but Saxena explained export lines were diverted to meet requirements in the domestic market.