India’s Carmakers Seek Federal Aid After 9% Sales Drop

The Society of Indian Automobile Manufacturers says it will ask for a government stimulus plan to counter the country's worst slide in auto sales in at least 16 years.

SIAM reports that wholesale deliveries of new passenger cars in India fell to 139,600 units last month from 153,500 units in June 2012.

June marks the eighth consecutive month of year-over-year declines in the country's car sales. SIAM attributes the ongoing slump to India's slow economic growth, rising inflation and high interest rates and fuel prices.

The group may call for a scrappage program and a cut in taxes that carmakers must pay on vehicles.

In the April-June period, car deliveries in India dropped 10% year over year to 434,600 units. Demand fell 6% for vans and 8% for commercial vehicles, but SUV volume rose 5%.

SIAM previously forecast that the country's sales in the fiscal year ending on March 31 would grow 3%-5% to as much as 1.98 million units from the previous period. The group now expects deliveries to shrink, but it has not yet revised its outlook.