India car sales fall in 2011

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Indias auto industry has been a booming one for the last five years, with global auto giants making the country one of their priority markets. But 2011 hasnt kind to the industry. CCTVs India correspondent tells us more about the volatility of the Indian car industry this year.

The year 2011 was a game of seesaw for the Indian car industry. A year that will be known as one of the most unpredictable ones. An industry booming at an average 30 per cent growth fell down to such lows that experts say a 2 to 3 per cent growth for the year 2011 is all that one can expect.

This despite a slew of launches in the segment that is considered one of the most lucrative segments in India the small car segment.

Chairman of NICCO Corporation Rajive Kaul said, "I think the problem if at all will be in the timing of the launches, the type of models, the customer preferences, the reading of customer preferences, other things also have to be taken into account. But certainly there has been a slowdown in the automotive industry."

The larger economic picture of India was largely responsible for the dismal figures of the car sales in India. Fuel prices have become 30 per cent higher that what they were a year back in India, interest rates hikes have been another reason and most importantly high inflation made people change their spending habits all of which translated into car industrys bad performance.

But experts say in the long term, Indian car market has huge growth prospects.

Arvind Kapur, President of Automobile Components Manufactures of India, said, "I am sure the market is going to bounce back. ! It is a very temporary phenomenon. If you look at the medium term at 2015 and if you look at 2020 I am sure will be reach the 10 million cars. The growth is going to take place but it wont be consistent growth year on year."

The year 2011 saw 77 new car launches in India including all car segments. Most of these cars were cheaper than 20,000 dollars. But nothing was exciting enough to kindle the imagination of the car buyer in India. Year 2012 will be a year of more car launches with many companies looking at launching cars but interest rates and inflation will decide what speed these cars end up reaching in the Indian car market.

Editor:Zhang Jingya |Source: CNTV.CN



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