First time in three years, car sales grew in FY15 by 4.99 per cent to 1.87 million units

The financial year 2014-15 brought several good news for the automobile industry. For the first time in three years, car sales grew in FY15 to the extent of 4.99 per cent to 1.87 million units, compared to the two preceding fiscals when sales declined by 7.74 per cent and 4.45 per cent respectively. For the whole auto industry, the reported increase in overall vehicle sales in 2014-15 is to the tune of 7.22 per cent.

The Society of Indian Automobile Manufacturer (SIAM) stated that the industry, passenger vehicles, commercial vehicles, three wheelers, and two wheelers, produced a total of 21,468,103 vehicles in April-February 2015. For April-February 2014, this figure stood at 19,645,555. The auto industry grew at a rate of 9.28 percent over the same month last year.

Focusing on the sales of Passenger Vehicles, the sector grew by 4.03 percent in April-February 2015 over the same period last year. Passenger Cars and Utility Vehicles grew by 5.24 percent and 5.46 percent respectively, while Vans declined by 11.00 percent in April-February 2015, compared to the same period last year.

Sales of two Wheelers registered a growth of 8.97 percent in April-February 2015 over April-February 2014. Within the Two Wheelers segment, Scooters, Motorcycles and Mopeds grew by 26.59 percent, 3.24 percent and 5.55 percent respectively in April-February 2015 over April-February 2014.

Over the period of April-February 2015, overall automobile exports grew by 16.92 percent over the same period last year. Passenger Vehicles, Commercial Vehicles, Three Wheelers and Two Wheelers grew by 5.82 percent, 12.37 percent, 13.84 percent and 20.78 percent respectively during April-February 2015 over the same period last year.

Predictions for the current fiscal

For the FY 2015-16, the industry looks upbeat with the central government's boost towards an economic revival. It is now looking at a double-digit growth in sales in the current fiscal. Retail sellers of auto spare components also feel that the industry would at least do as well in the current fiscal year. They are, however, expecting a bigger boom in FY 2016-2017 when all the reforms, interest rate cuts, new car models launched by various companies in the small utility vehicles segment, and benefits in terms of loans and support from the central government will start to accrue. A possible vehicle fleet modernisation programme keeping in mind environment-friendlyness is also expected to go a long way generate significant incremental sales.

Improved macro-economic sentiments, stable commodity prices, re-start of mining activity and infra projects, and higher industrial activity with an improved investment climate is also expected to affect the industry positively.

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