Carmakers expect surge in sales during the festive season

Festive season can change moods and can even lighten up market sentiments, as realized by car makers in India. All big names in auto industry like Maruti Suzuki India, Hyundai India, Honda India and Toyota India, which were heavyhearted a month before due to dismal car sales can now be seen with little smiles on their faces. Nearly all of them expect a 15%-20% increase in sales during this festival season. It is evident as the new Maruti Swift, Honda Brio, M&M XUV 500, Toyota Etios diesel and Hyundai Verna are now under long waiting period of up to eight months for delivery.

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The car market has witnessed a sudden thump with the end of Shraadh period in India. Most of the Indians wait for Shraadh to end and plan a purchase near the auspicious festival of Diwali. Customers can now be seen thronging showrooms to check out new models and special discounts offered by many companies. Maruti Suzuki executive believes that their company has witnessed a pent up demand in last few days on account of Navratras that could well lead to a genesis of revival in the otherwise damper car market. Arvind Saxena Director (Marketing and Sales) of Hyundai India said that the launch of 800 cc Eon compact car on 13th this month is expected to boost Hyundai's sales and market share in coming months. Car sales were dismal for two consecutive months before showing slight step-up in September. Higher petrol costs, lending rates and overall inflation impacted consumer demand in the past. However, signs of rebound in the car market are quite surfaced. Even retailers have reported 50% jump in sales last weekend.

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Banks involved in lending activities also point towards stable interest rates on loans after the central bank raised benchmark rate last month. Even car manufacturers are hoping a positive change as static loan interest rates will revive consumer interest after a dull start to the fiscal year. Sumit Bali Kotak Mahindra Prime Director said that a revival of sales was helped by both new car launches and stable interest rates that are expected to continue for the rest of the festive months of October and November. Even, Rajan Paintal Senior Vice-President, Auto Loans at HDFC Bank also supported the news.