In February 2012, the Indian car industry registered record sales, which is followed by high industrial production. The country witnessed greater demand for cars despite high price of fuel and escalating interest rates and flagging economic conditions. In February 2012, car sales increased by 13% compared to the corresponding period last year.
According to Society of Indian Automobile Manufacturers (SIAM), 211,402 vehicles were sold by automakers in February out of which 200,000 vehicles were purchased by Indians. We are sticking to our car sales growth forecast of zero to 2% in the fiscal year 2012,” said Vishnu Mathur, director general of the Society of Indian Automobile Manufacturers (SIAM).
The main reason for the increased sales figure is buyers’ anticipation of higher excise duties on cars after the Union Budget. Buyers also expect price of diesel vehicles to increase, which at present are on heavy demand due to Government subsidy on diesel.
While some considers these heavy purchases as expectation of price increase after budget others feels that customers are confident that interest rates will not be lowered by banks any more. Hence, those customers who have withheld their purchase decision at the end of 2011 are purchasing new vehicles.
