Price rise may hamper the growth in next fiscal

High Growth of auto industry in last financial year is not expected to be continue in this fiscal as rising input material and excise duty increase by the by the government will possibly have a bad impact on sales.

According to SIAM (Socity of Indian Automobile Manufacturers), the sales of passenger cars, two-wheelers and commercial vehicles registered a growth of 26.41% for the financial year ended in March this year, but growth in 2010-11 is projected to fall by a half. where the last year’s growth was high because of an almost flat market the previous year, this year the high base effect and possible interest rate rises could harm the growth in India.

Overall the industry is in good shape but we have some concerns, said, SIAM chairman Pawan Goenka said, adding that a potential rise of up to 9% in vehicle prices is the main growth worry.

Auto Industry in India has registered a record braking sales growth in last quarter of last fiscal, thanks to the Delhi Auto Expo where lot of new cars were launched in India. The new car launched in India this year includes compact hatchback Chevrolet Beat, Ford Figo and Volkswagen polo.

However, in next fiscal many new cars will be launched in India including Nissan Micra in July 2010, Toyota Etios in Dec 2010 and Honda's new small car in March 2011.

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