India's 2013 car sales down for first time in 11 years

(MENAFN- AFP) India's car sales fell almost 10 percent year-on-year in 2013 in the first decline for 11 years, an industry body said Thursday, amid sluggish economic growth and higher fuel costs and interest rates.Annual domestic car sales, seen as a pointer to overall economic health, fell to 1,807,011 units in 2013 from 1,998,703 in 2012, according to the Society of Indian Automobile Manufacturers (SIAM)."After 2002, this is the first time the auto industry has seen a decline in annual passenger car sales," Sugato Sen, SIAM's deputy director general, told AFP.For the month of December alone, domestic passenger car sales fell 4.52 percent to 132,561 units, against 138,835 units in the same month a year earlier.Previous years posted annual growth of 20 to 30 percent in car sales. Those boom years prompted foreign automakers to make a beeline for India as they sought to boost sales globally.But stuttering demand in India in 2013 forced automakers to introduce interest-free repayments and huge discounts, while top vehicle makers such as Maruti and Mahindra and Mahindra cut production.The industry is unlikely to see a revival in demand soon, SIAM officials said."Demand for cars is not expected to move up in the financial year (ending March 2014)," Sen said, while declining to forecast an exact sales figure.Analysts do not expect the car market to revive until the second half of 2014, after the general elections in May.India's economy has been growing at a decade low of five percent, putting the brakes on the once-red hot domestic car and commercial vehicle market.