Indian Auto Industry to Set New Sales Records this FY

It's 31st March today, and it's going to be a landmark day for the Indian domestic auto industry. Any guesses, why? - As the current financial year comes to an end today, the sales figure is set to hit an all time high of 12.2 million units in 2009-10 that surpasses its previous sales records of 10.1 million units in 2006-07.

This phenomenal growth is thought to be a resultant of four main things:

• - New launches, mainly in the the compact car category
• - Easily available car loan schemes with low interest rates
• - 4% reduction in excise duty as part of the fiscal stimulus
• - Phenomenon of low base-effect

Surge in auto sales during the mid-year festive season also contributed significantly to this two-digit growth performance. In fact, that was the reason why Society of Automobile Manufacturers (SIAM) revised their one-digit fiscal forecast to a two-digit one.

The growth which mainly comes from the passenger car volumes and two wheelers and commercial vehicles, seems to be have given the confidence of SIAM a major boost. The apex industry body representing leading vehicle and vehicular engine manufacturers recently said, the growth momentum is here to stay and will continue further for the next couple of years in the domestic marketplace.

However, experts are of the view that there might be a slump in auto sales as the year proceeds. But for now, it is celebration time for automakers in India.