The Indian auto industry, which has been growing at a considerably high rate since last one year, has registered sales of more than 2.5 million cars in the Indian market in FY10-11. As many as 64 new car models were launched in the Indian market during the year. As per the data released by Society of Indian Automobile Manufacturers (SIAM), the vehicle sales surged 30 percent during the year.
In a recent statement, SIAM President Pawan Goenka said, "We have had the best year so far, but the growth is likely to moderate to around 12-15 % for the auto industry in this fiscal."The continuously rising cost of input materials including steel, aluminum, copper, lead and natural rubber has already forced most of the car makers to enhance the price of their cars in the Indian market."
Mr. Goenka added that the industry has been absorbing the increase in input costs for a long time, but going ahead car makers will be forced to pass on the burden to the customers as their profit margins are already under pressure.
On another note, since last one year, major car makers including Maruti Suzuki and Tata Motors have been losing their market share to comparatively newer and smaller firms like Ford and Volkswagen India. It remains to be seen how further price escalations will affect this trend.
