Car sales to miss FY15 growth target

India’s car sales are set to fall below the earlier growth target for FY15 set by the Society of Indian Automobile Manufacturers (SIAM).

Car sales growth this financial year is likely to be below five per cent, Sugato Sen, deputy director-general, SIAM, said on Monday.

In August, the industry body said it expected domestic car sales to grow between five  and 10 per cent, helped by an improved sentiment after the Narendra Modi government took office in May.

“We are not being able to sustain only by creating positive sentiment,” said Sen. “Unless the real economy starts growing...we may not see a very robust growth in the auto sector, especially the passenger vehicle market.” Sale of passenger vehicles, which includes cars and utility vehicles, fell 7.5 per cent in October to 221,151 units from a year ago, breaking a rise for five months. Passenger car sales were lower by 2.6 per cent.

Two-wheeler sales also declined for the first time in several months in October, by 3.6 per cent to 1,461,712 units. Sales of scooters grew 10.9 per cent to 383,885 units but those of motorcycles fell 8.7 per cent to 1,008,761 units.

Medium and heavy truck sales continued to be upbeat and increased 25.3 per cent to 17,866 units, with a pick-up in economic activity and lower diesel prices. India's truck market, which had halved in two years, is making a comeback. Light commercial vehicle sales were down 13.2 per cent to 34,099 units, dragging overall CV sales down three per cent to 51,965 units.