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      Car sales in India witness 16 percent dip in July 2011

      Vikas Yogi

      Vikas Yogi

      The Indian automobile industry has witnessed the biggest drop in the monthly sales in July, in nearly last three years. The monthly sales in the Indian auto industry declined 16 percent during the month of July as compared to the units sold in the same month a year ago period. The major contributors to this decline were increased fuel prices and high interest rate on auto loan.

      As per the data released by Society of Indian Automobile Manufacturers (SIAM), the car sales in the country dipped to 133,747 units as against 158,767 units sold in the same month last year.

      Speaking to the reporters, SIAM director general Vishnu Mathur, "People want cars, they want mobility, but they may be postponing their purchases hoping interest rates will go down."

      Before this, the previous biggest fall in the monthly sales was in November 2008 when the car sales declined by 19 percent over the units sold in the same month preceding year.

      As per the JD Power and Associates, India is all set to become the third largest auto market in the world by year 2020, from its current status of the sixth largest car market.

      Last year, the Indian automobile industry witnessed a dream run with registering a whooping surge of 30 percent in its sales to 1.98 million units, backed by the lower borrowing cost and a series of new car launches by the international car makers in the volume driven mass segment.