Auto industry grows overall but at a slow pace

The Indian automobile industry is likely to accumulate a turnover in the range of Rs 2.10-2.40 crore in the current financial year recording a double digit growth of 12-15%. However in the last fiscal, the growth rate was 34.2%.

Heavy Industries and Public Enterprises Minister, Praful Patel informed the Parliament through a written reply today that the cumulative growth rate of automobile and component industries during the last two years stood at double digits.

The industry registered sales of 54,21,089 units during the April-July period this fiscal, showing a growth of 13.55 per cent over the same period in 2010-11. However, particularly in July, car sales in India had fallen for the first time after two and a half years of continuous growth, registering a 15.76 per cent decline, mainly due to hikes in lending rates and petrol prices. Carrying forward the mood, domestic car sales fell in August,  with the big three makers -- Maruti Suzuki India, Hyundai Motor India and Tata Motors. The sales of Maruti Suzuki India fell by 12.7% in August. Tata Motors witnessed a three percent downfall in its August sales. Both domestic and export sales of the company fell down whereas Hyundai Motors secured a minimal 1 percent growth for itself.

Patel cited figures released by SIAM (Society of Indian Automobile Manufacturers) and its prediction that the organisation may further lower the growth projection for vehicle sales in the country from the revised 11-13 per cent, announced two months earlier.

SIAM also said that sales of commercial vehicles grew by 22.62 per cent to 64,248 units in August under review from 52,394 units in the year-ago period. So, despite the market witnessing a slowdown at present, SIAM has said the size of the Indian car market is likely to touch 5.6 million units by 2017, up from 2.2 million units per annum currently.