The Society of Indian Automobile Manufacturers said that Automobile sales in India are expected to pick up from mid-September as a precursor to the festive season.

Mr Vishnu Mathur director general of SIAM told reporters that "We do expect the markets to pick up somewhere around mid-September before the festive season begins.”

According to Mr Mathur, the auto industry was reeling under the pressures of high input costs coupled with rising fuel and interest costs which have dampened consumer sentiment. He said that "The consumer sentiment is down right now, because of which the footfalls at the showroom are not being converted into purchases.”

Mr Mathur added that high interest rates are also deterring small and medium enterprises in the automobile sector in their expansion plans. He said that "The most effected are the tier-I and II companies who need to borrow money for their expansion plan.”

Commenting on the sales figures for August, Mr Mathur said that "It is too early to give an accurate figure as data from some major companies have not come in yet. But there are signs of slowdown."

Mr Mathur further said that "The passenger car sector is certainly hit because of low conversion rates from enquiry rates to purchases due to high interest rates, but on the other hand, initial data from the two wheeler segment has shown positive growth.”

Last week, automobile majors such as Maruti Suzuki, Hyundai and TATA Motors came out with dismal August sales figures.

Maruti Suzuki - Down by 17% to 77,086 units
Hyundai Motor - Down by 6.7% to 26,677 units
TATA Motors - Down by 33.2% to 16,829 units

General Motors - Up by 14% to 9,050 units
Ford India - Up by 9% to 8,914 units
Toyota Kirloskar Motor - Up by 83.82% to 11,693 units
Volkswagen - Up by 72% to 6,091 units
Honda Siel - Up by 25% to 6,907 units

(Sourced from ET and FE)