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Car sales in India are expected to grow by nine per cent this year riding on the back of GST regime as well as new product launches, Moody's Investors Service said on Wednesday.
"Indian car sales will remain robust, growing 9 per cent this year and 7 per cent in 2018, supported by the impact of India's new goods and services tax (GST) as well as new model launches," Moody's said in a global report.
Elaborating further, the report said the GST rollout in July, replacing a web of indirect taxes in India, prompted some automakers to lower prices of their passenger vehicles.
This encouraged dealer restocking and led to a subsequent boost in sales, it said.
"Looking ahead, new model launches by domestic and foreign automakers and a seasonally stronger second half support our expectation that India's auto sales in 2017 will touch the 3.6 million unit mark," the report said.
Commenting on the global scenario, Moody's said auto sales will decline by 3.6 per cent in 2017 and 0.6 per cent in 2018 as the accommodative financing environment and used car prices come under pressure.
"That said, replacement demand in the wake of Hurricanes Harvey and Irma will provide some temporary relief from weakening demand," it said.
It added that Chinese auto sales will grow 3 per cent this year and 2 per cent in 2018.
Besides, Japanese car sales will grow by a robust 5.6 per cent this year and 2 per cent next year, the report said.
