India Automaker Group Sees Recovery Consolidate in Second Half

India’s vehicle market will see a recovery consolidate in the second half of the fiscal year as rural demand picks up, according to an automakers’ association.

There’s a “moderate recovery taking place” in the auto market and a “more definite” trend is expected in the six-month period starting September, Vishnu Mathur, director-general of the Society of Indian Automobile Manufacturers, said in New Delhi on Monday. Passenger vehicle sales in July rose 11.4 percent, the most since April, while commercial vehicle deliveries climbed at the fastest pace in five months.

The optimism is stemming from expectations there will be more precipitation this monsoon season than last year in a country where more than half the farmlands depend on rain-fed irrigation. While automakers such as Maruti Suzuki India Ltd. and Mahindra & Mahindra Ltd. get about a third of their sales volume from rural areas, others like Hyundai Motor Co. are adding dealerships in the countryside as farm incomes rise.

Passenger vehicle sales will probably expand faster than the 6 percent to 8 percent pace projected in March, Sugato Sen, deputy director-general of the group, said.

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