Indian automobile industry reported a slump in July sales, caused mainly by the rising interest rates and fuel prices.

The passenger car major Maruti Suzuki reported a 25.33% dip in its July sales at 75,300 vehicles compared to July of 2010, as a result of sluggish demand and two scheduled production cuts. The domestic sales for July also were down 26.2% at 66,504 units, while exports were 18.1% lower at 8,796 vehicles.

The company said that manufacturing of its bestselling sedan model Swift Dzire was shifted from Manesar to Gurgaon, temporarily affecting the production of the car. Maruti Suzuki statement said that "While overall automobile market was sluggish, owing to these two planned activities, sales in July 2011 were negatively impacted by nearly 17,000 units compared to July 2010.”

Another automobile giant TATA Motors came out with cumulative sales of 63,761 vehicles in July, down 6% from the like period of last year. The company said that "Domestic sales of TATA commercial and passenger vehicles for July 2011 were 57,990, lower by 9% over 63,559 units sold in July last year.”

Cumulative sales for the fiscal grew by four percent at 256,799 units, over 247,381 units sold in the like period of last year. Segment wise, the company reported a 14 percent growth in sales of its commercial vehicles at 40,798 units as against 35,694 units sold in July last year.

Automobile major Hyundai Motor also reported a decline of 1.5% in sales for July at 49,667 units as against 50,411 units in the corresponding period last year.

Mr Arvind Saxena director, marketing and sales of Hyundai Motor said that "The customer enquiries have increased but due to the increase in fuel price and interest rates, conversion rate has slowed down.”

(Sourced from ET)