Car Sales in India Rise Only 3%

Automakers sold 163,200 passenger vehicles in India last month compared with 158,800 units in May 2011, according to the Society of Indian Automobile Manufacturers.

SIAM blames May's tepid sales gain the smallest year-over-year increase in seven months on higher interest rates and gasoline costs, waning consumer confidence and rising vehicle prices.

The trade group says car sales may decline in coming months. SIAM previously predicted that India's passenger vehicle sales would advance 12% to 2.3 million units in the fiscal year ending March 31, 2013. Now it plans to review that forecast.