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Car Sales Surged, Two-wheelers Demand Dipped in October
Nov 27, 2007

Car sales shot to an all time high this October, driven by a robust economy, discounts and the affluent youth. Two-wheelers, on the contrary, dipped in their demand.

Passenger cars sold out like hot cakes in India recording a strong growth in October. Car makers rolled out new models and put forward discounts to attract buyers. Two-wheeler sales, on the contrary, showed a decline, going by the figures released by two-wheeler makers, as per the news published by Livemint.

Maruti Udyog kept up its smooth run, clocking a 15.4% shot in sales at 69,415 units (60,163). Domestic sales witnessed a 15% growth counting to 64,258 units (55,894), while exports zipped ahead to almost 21% with 5,157 units (4,269). Also, India’s largest manufacturer of Sport Utility Vehicles (SUVs), Mahindra & Mahindra Ltd, recorded a 46% increase in domestic sales in October owing to the great demand for its Scorpio SUV and the new sedan, Logan.

Two-wheeler manufacturers, on the contrary, reported a sharp dip in their sales as prospective customers put off plans to buy automobiles due to the current wave of high interest rates.

The passenger car market in India has burgeoned due to an expanding economy and rising incomes. Easy availability of loans for automobiles post liberalization of the Indian economy is another reason why car sales have boomed in India. Automobile companies are today enjoying the attraction from the young populace with a strong purchasing power and easily available finance options.

Stock market boom and rapid economic growth has boosted wealth among the people, enabling them to buy a car, when only seven per 1,000 people own a car in India. So the international players have set their eyes for a big share of the booming automobile market in India.

As per a research reports "Indian Automobile Sector - A Booming Market" published by RNCOS, currently, the rising personal disposable incomes are driving the compact passenger car segment which is going strong. Increasing incomes, price cuts, low ownership costs, rising buyer incentives, and attractive financing schemes will continue to support the auto (car) demand, with hike in car sales averaging nearly 12% annually during the period spanning from 2007-08 to 2011-12. Also, low motorcycle and car penetration rate in India is indicating a good potential for growth in future.

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