February has ended on a very good note for India’s Automobile industry, which registered a net increase of 49% in sales in February, 2010, as compared to the same month’s sales in 2009. This rise can be attributed to the anticipation of a hike in taxes after the budget. Some experts are also calling it an effect of the new emissions norms that are scheduled to take effect soon.
This news is a good indicator for Indian economy on many levels. Indian automobile market has been showing an upward curve, even as the world automobile markets suffer through one of the worst downfalls in the history. Even though, the prices of most automobiles have increased in the past year, it has failed to deter the growth in the sector.
What’s most encouraging is the rise in the sales of commercial automobiles sector, which saw an increase of 119.4% as compared to the sales in February 2009. It is a positive sign for the overall economic growth. Private vehicles saw an increase in 33.2% and sold over 1.5 lakh units. Utility vehicles registered an increase of 37.2% and sold more than 40,000 units.
Maruti Suzuki, which is one of the biggest and oldest car manufacturers in the country, sold 96,650 units in the month of February and registered 22% growth from the last year. It was actually the biggest monthly sale for the company in its history. Due to the increased demand, the company is now planning to increase its annual production capacity to 1.25 million units from 1 million units.
Tata Motors which is India’s biggest commercial automobile manufacturer is not far behind either. They also registered their highest monthly sales in the history by selling 69,427 units in the month of February, 2010. It was an increase of 58% from February 2009.
But this trend may see a roadblock in the coming months. As a part of a rollback on fiscal stimulus measures, an increase of 2% in excise duty was announced by the Government of India on February 26. Automakers quickly passed this rise on to the customers and prices of most automobiles have increased in March.
But an analyst from Angel Broking, Vaishali Jajoo, thinks that the government’s efforts to improve rural infrastructure will boost the sales of vehicles in the long run. In her research note, she said, “Over the longer term, comparatively low penetration levels, a healthy economic environment, and favorable demographics, supported by higher per-capita income levels, are likely to help the auto companies in sustaining their top-line growth.”
Here, it should be mentioned that the automobile export from India is also on a record high. As compared February 2009, there was a 44.9% increase in this field. In fact, the export of commercial vehicles has registered an increase of more than 100% from February 2009.
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.
