Maruti SX4, Renault Logan push car sales

July 13, 2007

Passenger car sales zoomed in June 2007, recording the highest sales in four months. The rise in sales is being attributed to the popularity of Maruti Udyog's SX4 sedan model and Renault's Logan. According to the figures revealed by the Society of Indian Automobile Manufacturers, car sales went up by 16 per cent to 94,002 vehicles in June 2007 over June 2006. Meanwhile, sales in the three months ended June 30 rose 13 percent to 275,147 cars.

With banks fixing interest rates at eight-year highs, new models are being rolled out by automakers, and discounts are being offered on older variants to lure auto enthusiasts. Experts opine that new models are indeed pushing car sales. Demand is growing even as interest rates rise. More than half of the vehicles sold in India are bought on credit. Banks increasing lending rates by between 200 basis points and 250 basis points have added to the activity in the Indian car mart. Maruti and the local unit of Toyota Motor Corp have adapted themselves to the situation by offering discounts and subsidized interest rates to lure buyers.

The SX4 from Maruti Udyog, which debuted on May 7, 2007, was the car maker's first sedan in eight years. Currently, with the model proving to be a hit, the Indian unit of Suzuki Motor Corp. has a two-week waiting list for the model. The company, which controls half of Asia's fourth-biggest automotive market, has introduced five new or upgraded models in the past 12 months to win customers. Maruti's car sales gained 27 percent to 47,783 units last month.

Meanwhile General Motors, which introduced its first minicar in the country in April 2007, saw sales figures more than double to touch 3,229 units, said a report. Mahindra & Mahindra, which introduced Renault's Logan in April 2007, sold 2,380 sedans, it added. Another prominent player, Hyundai, which happens to be India’s second largest car maker, is all set to introduce a diesel variant of its Getz hatchback this year to attract customers. The company's sales fell 4 percent to 16,314 in June. Sales of Tata Motors Ltd., the third-ranked carmaker, fell 7.1 percent to 14,081.