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Our Bureau

Growth in passenger, utility vehicles continues

New Delhi June 8 The auto industry seems to have hit a speed breaker of sorts with the two-wheeler and heavy commercial vehicles segments particularly feeling the bump from the recent hardening of interest rates.

According to the Society of Indian Automobile Manufacturers' latest data for May, two-wheeler sales during the month at 6.06 lakh units, dropped 9.88 per cent below the 6.73 lakh sold in the same month last year. Cumulative sales of two-wheeler at 11.77 lakh units during April-May 2007, too, were lower than the 12.79 lakh units of April-May 2006.

The same story of declining sales has been seen in the case of medium and heavy commercial vehicles: 17,697 units in May (19,575 units) and 35,375 during April-May (37,688 units).

Within this segment, it is the sales of goods carriers that have really plunged to 14,993 in May (17,866) and 30,374 units in April-May(34,552).

"Roughly 70 per cent of our two-wheeler and truck sales are financed. The rise in interest rates have clearly impacted these segments," said Mr Abdul Majeed, Executive Director, PricewaterhouseCoopers.

Passenger vehicles

On the other hand, the SIAM data reveals a continuing rise in the sales of passenger vehicles. A total of 1,21,743 units were sold in May (up from 1,10,384 in May 2006), with the corresponding cumulative April-May numbers being 2,28,993 (205,178).

"Passenger car sales are less sensitive to interest rates considering that buyers are influenced more by other factors such as launch of new models. Having to pay higher instalments would not be a decisive factor in the immediate context", added Mr Majeed.

Within this, passenger cars recorded an increase of 9.06 per cent to 96,922 units, utility vehicles sales stood at 18,325 units, 12.9 per cent up and multi-purpose vehicles grew by 22.68 per cent to 6,496 units.

Maruti Udyog Ltd registered 9.02 per cent increase in its sales at 49,353 units, followed by Hyundai Motors India Ltd at 16,617 units, 3.45 per cent increase over the previous year. Honda Siel Cars India grew at 11.18 per cent by selling 4,433 cars. However, Tata Motors sales dipped by 6.79 per cent at 14,217 unit.

Utility segment

The utility vehicles segment recorded 12.93 per cent increase with sales at 18,325 units and multi-purpose vehicles recorded sales of 6,496 units, a 22.68 per cent increase over the previous year.

In the commercial vehicles category, the light commercial vehicles witnessed 16.68 per cent increase with sales at 15,565 units.

In the two-wheeler segment, the scooter/ scooterette segment sales increased to 92,048 units, a jump of 24.52 per cent in comparison to the motorcycles segment where sales have fallen to 4,77,901 units, recording 16.35 per cent dip over the same period in the previous fiscal.

Hero Honda sales declined to 2,69,532 units, a 5.49 per cent drop in comparison to second largest player, Bajaj Auto Ltd which witnessed a massive fall of 24.94 per cent with its sales at 1,29,724 units.

More Stories on : Automobiles | HCV/LCV/Tractors

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