Auto industry body SIAM today revised car sales projection for the fourth time in the current fiscal, forecasting a meagre growth of 0-1 per cent -- down from the first ambitious estimation of up to 12 per cent.
The downward projection reflects severe slowdown in the industry across the segments.
"Based on the third quarter performance, SIAM is revising the projections. There are significant changes in expectations based on performance of all segments till date," SIAM President S Sandilya said told reporters here.
SIAM Deputy Director General Sugato Sen said continuous changes in the overall economic scenario as well as the domestic and international markets impact growth.
"Initially we thought that the market will perform good so we projected a growth of 9-11 per cent, but it was not the case. Every time a new issue crops up. So, accordingly we have to revise the projections," he said.
Society of Indian Automobile Manufacturers (SIAM) has lowered car sales growth projection to just 0-1 per cent for this fiscal, from 1-3 per cent and 9-11 per cent announced in October and July respectively. In April, it had forecast a growth of 10-12 per cent for 2012-13.
Sandilya said there are no signs of a significant growth in the sector because of slow economic growth, inflation, high vehicle finance and fuel prices and differential excise rates.
SIAM also said the auto industry will miss its ambitious target of clocking an annual turnover of USD 145 billion by 2016 under the Automotive Mission Plan (AMP).
"AMP target of annual turnover of USD 145 billion by 2016 is expected to be missed by USD 34 billion," Sandilya said.
"SIAM requests government to look into the possibility of extending AMP till 2026 to further nurture the sector to extract full potential benefit for the economy in terms of contribution to GDP, value addition and employment," he added.
In the third quarter of this fiscal (October-December), passenger vehicle sales, including cars, grew by 11 per cent at 6,81,000 units.
He said the overall economic situation in the country, low sentiments, high petrol prices and interest rates are among the factors hurting the overall sales of the auto industry.
Overall, the auto industry's sales are expected to grow by 3-5 per cent, much lower than the earlier estimate of 11-13 per cent for this fiscal, Sandilya said.
He said that SIAM has already approached the government to extend the tenure of the AMP by another 10 years in the wake