SIAM Cuts Forecasts

Industry body SIAM (Society of Indian Automobile Manufacturers) revised growth estimates for a few segments yesterday on the back of the monthly sales figures for the month of June 2012. Since the beginning of FY 2012-13, the industry has been facing turmoil over reduced demand due to fuel prices and interest rates.

SIAM has reduced estimates for passenger cars to 9-11 per cent from the earlier forecast of 10-12 per cent. In FY 2011-12, passenger cars grew at 2.19 per cent over the previous year. Figures for April and May 2012 too have been sluggish with volume growth of just over 3 per cent for both the months. Though the June 2012 data showed growth of 8.3 per cent and considering the upcoming festive season and the lined-up launches by most players, 9-11 per cent is achievable.

The medium and heavy commercial vehicles (M&HCV) segment, which has been the most affected by the slowdown, has seen negative growth in double digits over the first three months of FY 2012-13, on which SIAM reduced forecasts from 10-12 per cent to 6-8 per cent. The segment of utility vehicles, which has been growing at a tremendous rate over the last two years, saw 47.32 per cent and 51.05 per cent growth in April 2012 and May 2012 respectively, on which SIAM increased the outlook from 10-12 per cent to 29-31 per cent.

The forecast for two-wheelers at 11-13 per cent has remained untouched and the sales volume figures so far have been in line with this. In this segment though, motorcycle sales have been sluggish while scooters have been consistently growing and supporting the segment.

Overall, we expect sales of passenger vehicles and two-wheelers to pick up over the second half of this financial year while the picture on M&HCVs looks gloomy considering the recent data.

Sales Volume Growth For FY11 and FY 12 

Sales Volume Growth