In the past year Indian passenger car sales soared by 30%, the most in over a decade, but surging raw material costs will put the brakes on further growth, the Society of Indian Automobile Manufacturers (SIAM) said on April 8.
Car sales grew to 1.98 million units in the just-ended fiscal year to March 2011 from 1.53 million the previous year, spurred by cheap loans and new model launches. "We have ended the year on a reasonably high note. We have reached a very strong base," said SIAM president Pawan Goenka.
The percentage gain in car sales in the year to March 2011 was the highest since 2000 when car sales soared 60%, SIAM said. But Goenka said growth would slow to 16% or 18% this year due to rising commodity prices and costlier loans resulting from a tighter monetary policy aimed at curbing inflation.
India is the second-fastest growing auto market in the world after China.
The sustained expansion of the Indian market in the face of saturated markets in the West has turned the country into a battleground for global vehicle manufacturers. Ford, Renault-Nissan, General Motors and Volkswagen and other automakers have all launched new models in India recently. Sales of Japanese-controlled Maruti Suzuki, India's car market leader, jumped by 26% to 966,447 units last year, while sales of rival South Korea's Hyundai Motor increased by 14% to 358,904 units.
In March, passenger car sales in Asia's third-largest economy jumped by 24% to 194,199 units from the same month a year earlier, SIAM said.
Copyright Agence France-Presse, 2011