Why Auto Sales Will Boom in 2015?

BANGALORE: Auto Ancillaries stocks are on a tremendous growth this year. The commercial vehicle sale has seen an adequate growth of 4-6 percent in 2014.The lower labour costs is an absolute advantage to Indian Auto Ancillary Companies.

It seems the market-watchers believe that there are many to off-set the price rise. Firstly, RBI has cut the repo rate by 25 points that will eventually benefit the customers who opt for financing the vehicles. Secondly the fall in prices of petrol (58.91 Rs/Liter) and diesel (48.26 Rs/Liter), which is the lowest since April 2013. These factors will surely kick the market sales on boom.

According to Maruti Suzuki Chairman RC Bhargava, "Ultimately you have to look at the total affordability factor for the customer. While the car prices have gone up, if interest rates come down, if petrol prices come down it will offset the increase in price," reports PTI.

With the government not continuing with lower excise duty beyond December 31, major car makers including Maruti Suzuki, Hyundai, GM India and Honda have raised vehicle prices by up to 1.27 lakh.

Moreover, these car-makers are giving good discount offers ranging from 5-15 percent that includes consumer benefits like waiver of insurance or registration costs, free maintenance contracts or free car accessories.

Boasting about their growth in the markets, Rakesh Srivastava, Senior Vice President (sales and marketing) Hyundai Motor India said, “In the last one year we launched four new products that helped us in gaining customers. We should be able to post double digit growth this year on the basis of new products and expanded reach,” reports Business Standards.

In the coming months a lot of auto-makers are launching new cars and bikes into the market and the car dealers are bullish will further prop up sentiments driving consumer traffic to showroom.

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