Auto industry likely to cross 10-million unit mark in FY10, grow at 22.6%

Written by Yogima Seth | New Delhi | Updated: Feb 10 2010, 06:22am hrs
The automobile industry is fast galloping to cross the 10 million unit mark. If average sales of the last 10 months are to be considered, then the total domestic industry will end the current financial year at 1,19,22,677 units, which will be a growth of 22.6% over 2008-09. While this is much higher than the earlier conservative growth estimates of 10% by the Society of Indian Automobile Manufacturers (Siam) at 1,06,95,730, as reported by FE, it will be record sales after two years. The previous record domestic sales happened in 2006-07 at 10.1 million units.

This comes on the backdrop of sales of over 10 lakh units each month since August and record sales of over 11 lakh units in January, courtesy new launches, easy availability of retail finance and soft interest rates.

According to Siam, the total automobile sales in the domestic market stood at 11,14,157 units in January as against 7,68,698 units during the same period last year, a growth of 44.9%. This is the highest ever sales by the auto industry and has come on the back of economic growth, reduced interest rates and better money supply in the system, Dilip Chenoy, director-general, Siam said, adding that the high growth in January was also contributed by last years low base as well as reduced commodity prices.

The domestic passenger car segment too posted the highest ever sales last month with a growth of 32.3% at 1,45,905 units as against 1,10,300 units in January last year. It was the 10th straight month of growth by the segment. The car manufacturers had earlier touched the peak at 1,29,358 units in March, 2009. While Marutis record sales because of Ritz and A-Star, General Motors India recorded its highest sales on the back of Chevrolet Beat and Spark.

Sales of Maruti Suzuki India, the countrys largest passenger car manufacturer, jumped by 18.6% last month at 70,029 units as compared to 59,060 units in the year-ago period, while that of Hyundai Motor India surged by 40.8% at 29,601 units vis--vis 21,015 units in January 2009 and Tata Motors registered a growth of 47.4% at 22,707 units as against 15,406 units during the same month last year.

Though sales in the remaining two months February and March would depend on multiple factors, Siam expects that the industry will continue with the ongoing growth momentum. Though sales in February will depend on multiple factors like pent up demand and price rise, we still expect to have good growth, Chenoy of Siam added.

Even two-wheelers continued on their growth spree with the overall sales going up by 43.4% at 8,34,383 units last month as compared to 5,81,729 units during the same month last year. While market leader Hero Honda Motor registered a growth of 23.9% at 3,66,050 units in January as compared to 2,95,241 units in the year-ago month, sales of its closest rival Bajaj Auto soared nearly three-fold to 1,79,212 units as against 66,207 units and Chennai-based TVS Motor posted 31% jump in motorcycle sales at 39,654 units as compared to 30,271 units in the same month a year ago.