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India's Passenger Vehicle Industry Posts 35% Growth in May
Jun 23, 2010

Inexpensive car loans and increasing income levels helped passenger vehicle sales in India to surge 35% in May 2010.
 
As per the Society of Indian Automobile Manufacturers (SIAM), India’s passenger vehicle sector grew 35% in May 2010, which is the highest ever, to reach at 190,575 Units from 141,145 Units in May 2009, reported Business Standard.
 
However, in absolute terms, March 2010 saw the highest monthly passenger vehicle sales ever, at 199,109 Units.
 
Nearly all major carmakers showed healthy performance in May 2010. Maruti Suzuki India witnessed 27.2% increase in sales (at 90,041 Units); Hyundai Motor India saw sales growth of 15.5% (at 27,151 Units); and sales of Tata Motors was up by 33.2% (at 25,186 Units) in May 2010. GM India and Ford India registered sales growth of 61% and 272% respectively.
 
The overall Indian automobile industry recorded increase of 30% in May 2010 at 1,208,851 Units as compared to 929,917 Units in May 2009.
 
Inexpensive automobile loans have led the car sales in India, which is Asia’s third-largest automobile market, to increase. Sales in May had also been supported by increased consumer expenditure and a revival in demand. With the economy performing well and per capita income increasing, sales in May became the highest-ever recorded sales.
 
Additionally, launch of new models in the market also lured the car buyers. General Motors with its Cruze and Beat and Ford India with its Figo are proving particularly popular. These competitively priced new models had provided Indian consumers with wider choice, which kept the car sales buoyant even in a traditionally lean month of May.
 
The growth trend is expected to continue in coming years also. According to “India Passenger Car Market Analysis”, a recent market research report by RNCOS, passenger car volume sales will grow at a projected CAGR of around 13% between 2010-11 and 2013-14.
 
According to a Research Analyst at RNCOS, “Growing middle class population, increasing income levels, launch of small and economical cars like Tata Nano, and rural development will drive the future sales growth. Government’s stimulus package as well as better road connectivity along with expansion of flyovers and roads will also support the growth in future sales of new passenger cars.
 
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