India`s tax cut keeps car sales buoyant in November
India's top carmakers reported robust sales growth to dealers in November on Monday, boosted by an earlier tax reduction that lowered vehicle prices and spurred demand.
Market leader Maruti Suzuki reported a 21% year-on-year rise in domestic sales, driven by sport utility vehicles as well as small cars like Alto.
Rivals Mahindra & Mahindra and Tata Motors Passenger Vehicles both posted a 22% sales jump, while Hyundai Motor India's sales grew 4.3%.
These companies account for more than 80% of total car sales in Asia's third-largest economy.
India in late September cut the goods and services tax on SUVs with engine capacities of more than 1500 cc to 40% from about 50% and on small cars to 18% from 28% in a bid to spur consumer spending and bolster growth amid steep U.S. tariffs.
Three out of the four top carmakers had also seen a rise in sales in October.
Consumers upgrading to premium models have also helped overall demand, analysts say.
Maruti's small car segment, its biggest, saw sales rise 18.9% in November, while its utility vehicle sales rose 22.9%.
In fact, automakers are finding it difficult to keep up with demand that stays buoyant after the end of the month-long festive season.
"We are not able to increase the production as per the market requirement. Our production team is working on Sundays, on holidays to ensure that we are able to meet the requirement," Partho Banerjee, Maruti's head of marketing and sales, told reporters.
Maruti Suzuki 170,971 21%
Mahindra & Mahindra 56,336 22%
Tata Motors Passenger 57,436 22%
Vehicles
Hyundai Motor India 50,340 4.30%
