With an economic slump and high borrowing costs discouraging buyers, India’s car sales slid by over 7% in July, marking a record ninth straight month of decline.
Carmakers sold 131,163 cars in India last month, down 7.4% from the same month in 2012, the Society of Indian Automobile Manufacturers (SIAM) said, with this data being the latest in a string of grim figures underscoring the weak state of Asia’s third-largest economy.
Total bus and truck sales plunged in July by 14.9% to 55,301 units from a year ago, while the most popular means of transportation in India – the motorcycle – also saw decline: slipping 1.5% to 809,312 units sold.
Last year, domestic passenger car sales fell by 6.7 percent to 1.89 million from a year earlier – the first contraction in a decade. SIAM has declined to set a sales target for this year. Also, the general economy grew at a decade-low of five percent last year, with the declining currency destroying hopes of interest rate cuts anytime soon to kickstart consumer demand.
The market’s downturn is in sharp contrast to the previous decade when car sales grew by 20% to 30% – prompting foreign giants like Ford or Volkswagen to make great investments in the country as they sought to boost sales globally.