Maruti October car sales down more than half

Maruti Suzuki, India's top carmaker, sold less than half the cars in October as it did a year previously as labour unrest that cost around USD 500 million in lost production compounded a demand slowdown in Asia's third-largest economy.

Maruti, 54.2% owned by Japan's Suzuki Motor Corp, ended almost two months of strikes last month, after losing production of over 80,000 cars and seeing its market share shrink to 40% from over 50% a year ago.
Car demand in India has slowed in recent months as high interest rates and rising vehicle and fuel costs deter buyers. Car sales in the country are driven by a burgeoning middle class, and about three quarters of new cars are financed by banks and financial institutions.
Sales fell in July in their first monthly decline in nearly three years, and continued to slide in August and September.
The unrest at Maruti began days after the launch of a revamped model of its popular Swift and hit production during India's festive season -- a period where automakers traditionally witness a sales boom.
Maruti sold 55,595 cars in October, down 53.2 percent from a year earlier. The unrest lead to a production loss of 40,000 cars during the month, the firm said in a statement.
Last week, the carmaker said profit in the quarter to end-Sept had more than halved from a year earlier.
Domestic rivals such as Tata Motors and Mahindra & Mahindra have benefited from Maruti's woes, with Tata posting a 22 percent rise in sales in September, growing its market share to 16.4 percent from 15 percent last year.
Having swelled at a breakneck 30 percent in the fiscal year that ended in March, Indian car sales are now expected to grow just 2-4 percent for this fiscal year, the Society of Indian Automobile Manufacturers said last month.
The Reserve Bank raised interest rates again last week, for a total hike of 375 basis points since March 2010.