The virus of slow growth in Indian automobile market continues to haunt carmakers with Reserve Bank of India raising interest rates yet again. Market experts fear that this rise is a big blow to the hopes of countrymen planning to buy cars as now financing costs will further climb.
"Market condition continues to be sluggish and the rate hike by the RBI by 50 basis points will have an effect on consumer sentiment," Maruti Suzuki India Chief Financial Officer Ajay Seth said. Honda Siel India also expressed similar views that market is already going through a tough phase of slowest growth in two year and with the rise, market will plunge further.
American giant General Motors Vice- President P Balendran was also worried and endorsed Honda Siel's words that the rate hike will further slow down the market. With the Indian auto market under pressure, the auto biggies had expected the RBI rates to be unchanged.
On the question of further slowdown, Honda Siel Cars India Senior Vice-President (Sales and Marketing) Jnaneswar Sen said "It is difficult to say at this moment, because usually the market picks up during August-September on account of the festive season."
