Slowdown hit auto sector optimistic over budget announcements

New Delhi/Kolkata/Chennai, Feb 1 (IANS) The Indian automobile sector, which was reeling under a slowdown in sales due to the government's demonetisation move, on Wednesday reported a lower-to-flat sales figures for January.

However, auto makers and analysts are optimistic on budgetary announcements to boost the sector.

"Focus on rural economy and infrastructure are two big positives. Continued focus on infrastructure with an outlay at Rs. 3.96 lakh crore would be a positive for the commercial vehicle industry. The reduction of income tax for companies below Rs. 50 crore is a positive, though the industry would have expected some relief on corporate tax for larger entities as well," Subrata Ray, Group Head, Corporate Sector ratings ICRA Ltd said.

Tata Motors passenger and commercial vehicle total sales (including exports) in January 2017 were at 46,349 vehicles, a decline of 1 per cent over 47,035 vehicles sold in the same month last year.

The company's domestic sales of commercial and passenger vehicles for January 2017 registered flat growth at 41,428 units, over January 2016.

Likewise, India's one of leading SUV manufacturer, Mahindra & Mahindra Ltd sold 39,303 vehicles in January compared to 43,789 vehicles during January 2016.

The company's passenger vehicles segment which includes utility vehicles, cars and vans sold 20,096 vehicles in January 2017 as against 22,088 vehicles during the year-ago month. The auto maker's domestic sales stood at 37,042 vehicles during January 2017, as against 40,693 vehicles during the corresponding month last year.

"The auto industry continues to see mixed reactions and some of the segments including the rural market and the commercial vehicles category continue to face challenging times," said M&M's President and Chief Executive (Automotive) Pravin Shah.

He said: "Going forward we expect the announcements made at the budget will positively impact the economy and also the industry, especially in view of the emphasis and the allocation made for rural, agriculture and infrastructure. We are confident that this will lead to a spur in demand."

However, Toyota Kirloskar Motor seemed to have bucked the trend and reported a 21 per cent increase in sales for January.

Similarly, the auto maker sold a total of 10,336 units in the domestic market in January as compared to 8,511 units sold in the same month last year.

(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)