India car sales slide 26pc, biggest drop in 12 years
NEW DELHI (AFP) – Car sales in India’s once-booming passenger market plunged nearly 26 per cent last month on an annual basis, their worst performance in 12 years, industry figures showed Monday.
Car sales, seen as a key pointer to overall economic health, slid by 25.71 per cent to 158,513 units in February from the same month in 2012, the Society of Indian Automobile Manufacturers (SIAM) said.
With one month left to report in the financial year, SIAM forecast annual sales would shrink for the first time since 2002-03. Sales have contracted by 4.64 per cent in the April to February period from a year earlier.
“Discretionary spending on cars has pretty well come to a stop with the economy slowing – if people don’t need a car, they are holding back,” SIAM deputy director general Sugato Sen told reporters.
“The weak economy, high inflation and high finance costs mean people at the bottom of the pyramid who buy the smaller cars, which are the biggest part of the market, are not buying,” he added said.
The car sales were the latest grim figures for India, Asia’s third-largest economy, which is forecast to grow by just five per cent in the current financial year to March 31 – its weakest pace in a decade.