Auto firms see brisk sales


Auto makers expect to overcome higher car prices, inflation pressures and interest rate hikes to maintain a sales momentum of 20-30 per cent in April-June.

The car market has been growing around 30 per cent month-on-month for almost two years as rising disposable incomes, easy availability of loans, a robust economy and a slew of new cars drove sales.

“Demand will continue to be strong in the coming quarters. While April is usually weak, the overall first quarter of 2011-12 should see double-digit growth for the sector,” R.C. Bhargava, chairman of Maruti Suzuki India, told The Telegraph.

For 2010-11, Maruti, the country’s largest car maker, reported a 24.8 per cent jump in sales at 12,71,005 units against 10,18,365 units in the previous fiscal.

The industry grew a record 31 per cent in 2010 to 1.9 million units.

Luxury car makers are also confident of garnering good sales numbers over the next few months.

“Having already exceeded half of last year’s sales in a single quarter, we are confident of being well on our way to ensure that 2011 is the most successful year for Audi India,” said Audi India head Michael Perschke.

In the first three months of this year, Audi sold 1,611 cars, up 107 per cent compared with 778 cars in the January-March period of 2010. The company expects the Audi A7 and the sporty A6 to be the growth drivers for 2011-12.

A number of global auto makers such as Toyota, Honda, Volkswagen and Ford are raising investments in the country. General Motors’ India head Karl Slym has said the company will invest around $500 million this year in its Gujarat and Maharashtra facilities.

“A strong economy, low penetration levels and higher disposable incomes will continue to assist a robust growth in the auto sector,” said Abdul Majeed, auto expert with PwC, adding that 20-30 per cent sales growth was achievable in this quarter.

He cautioned that the rise in commodity prices, 3-4 percentage points rise in loan rates and the impact of the crisis in Japan on the global economy might hamper sales momentum in the second and third quarters of 2011-12.

Companies are also betting on launches. Maruti has already sold 103 units of its premium sedan Kizashi, which was launched in February.

Toyota Motor, which launched the mid-sized Etios in December, has received record orders.

Two-wheeler makers are also optimistic about growth. “We are buoyant about Yamaha’s future in India and are strengthening our sales and service network in Tier 2 and Tier 3 cities to build upon the growth momentum,” said Hiroyuki Suzuki, CEO and managing director, India Yamaha Motor.

The company posted a 44.3 per cent growth in domestic sales during March.



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