India’s auto parts industry to halve this financial year

Article by Christian A., on September 2, 2011

For this financial year, the revenue growth for India's auto parts industry will probably be cut by as much as half due to the slowdown in domestic auto sales and a year-ago base that’s higher, according to the apex industry body.

For 2011-2012, the supplier sector is predicted to increase by 12% to 15% due to moderating business sentiment, a significant drop compared to the 33% growth seen in the previous fiscal year, when revenue increased to $39.9 billion due to a surge in auto sales. Srivatsa Ram, president of Automotive Components Manufacturers Association (ACMA), said that lower growth is expected.

Car sales were affected as credit has become more expensive due to the persistently high inflation in India, which has the second-fastest in the auto market worldwide after China, according to Autonews. Car sales in India have fallen 16% in July, the first decline in 2.5 years, after surging by 30% in 2010.

In the quarterly period that ended June, India’s economy expanded by 7.7%, its weakest in six quarters. It’s predicted to be even weaker due to the impact of interest rate increases, weak global conditions, and high inflation.

Since March 2010, the Reserve Bank of India has raised interest rates a total of 11 times. Several analysts expect the central bank to raise rates by an additional 25 basis points in its policy review on Sept. 16. For the Indian car market for FY2012 to 10% to 12%, the Society of Indian Automobile Manufacturers has reduced its growth estimate from 16% to 18%, as the demand has been down due to higher interest rates and increasing vehicle costs.

Topics: india

If you liked the article, share on:

Comments

Recommended

McLaren has already shown some interest in electrifying their models. And initially, we thought that they will just use hybrid systems to use across their current lineup. Nevertheless, we have...
by - August 19, 2017
Fifty years after its glorious victory at the 24 Hours of Le Mans, Ford launches the 2018 Ford GT ’67 Heritage Edition at the 2017 Monterey Car Week. The red...
by - August 18, 2017
Hyundai has recently unveiled an unnamed pre-production model of its new fuel cell SUV. We don’t know what to call this model just yet, but sources say that this model...
by - August 18, 2017
This weekend at the 2017 Pebble Beach Concours d’Elegance, the BMW Z4 Concept will make its first public appearance. The good news is that we will finally have a real...
by - August 18, 2017
While Honda’s new 2018 HR-V will be rolling out at the dealerships with just a few updates, the company is certainly not giving up its spot as the best-selling vehicle...
by - August 18, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries