Car sales in India fell for the first time after 14 months of continued growth in January as discounts dried up during the month with automakers correcting inventory at dealer levels post year-end freebies dole out.

According to data released by Society of Indian Automobile Manufacturers (SIAM), domestic car sales in January declined marginally to 1,68,303 units compared with 1,69,527 units in January 2015.

It is, however, bullish on the passenger vehicles segment to grow in the range of 8-12 per cent in the next fiscal. Overall passenger vehicle sales during the month grew marginally to 2,32,016 units in January as against 2,09,086 units in the year-ago period.

"There is muted growth in passenger car sales in January. Growth declined as people advanced their buying to December due to record discounts offered by the companies. Also, there was correction at inventory levels during the month," SIAM Director General Vishnu Mathur told reporters here.

He, however, termed the dip in passenger car sales a "temporary blip". "We don't expect it (dip sales) to be a long term phenomenon," Mathur said. Rising for a 14th straight month, car sales in the country surged by 12.87 per cent in December as customers were induced by the auto industry into buying new vehicles by offering record discounts.

When asked about the outlook for the next fiscal, Mathur said: "We expect the overall passenger vehicle sales to grow in the range of 8-12 per cent. In the current fiscal we expect to grow by 6-8 per cent. Till January we have grown by 8 per cent." Elaborating further he said: "Even though sales in rural areas are down, we have been able to grow by 8 per cent this fiscal. So if the rural markets are back in the next fiscal, we expect better growth in FY17."

During last month, market leader Maruti Suzuki India posted a marginal growth in its passenger vehicles sales at 1,06,383 units. Its car sales declined 1.41 per cent to 87,757 units during the period. Rival Hyundai Motor India saw its passenger vehicle sales rise by 9.3 per cent to 38,016 units in January, driven by newly launched SUV Creta. Its passenger car sales declined 9.36 per cent to 31,398 units during January compared with 34,643 units in the same period of previous year.

Honda Cars India's passenger car sales stood at 16,613 units as against 15,331 units in the same month last year, up 8.36 per cent, SIAM said. Homegrown Tata Motors' domestic car sales were at 9,350 units, compared with 11,637 units in the same month of previous year, down 19.65 per cent.

Utility vehicles major Mahindra & Mahindra saw its sales rise 13.39 per cent to 21,034 units as against 18,549 units in January 2015. As per SIAM data, motorcycle sales last month increased marginally to 8,72,325 units from 8,68,505 units a year earlier.
"Motorcycle sales continue to be impacted by slow uptake in rural areas. It will pick when these markets come back," Mathur said.

Last month, market leader Hero MotoCorp saw its bike sales decline 1.93 per cent to 4,60,066 units as against 4,69,136 units in same period of January 2015. Bajaj Auto saw sales rise 9.24 per cent to 1,40,853 units in January as against 1,28,937 units in the year-ago month, SIAM said.

Honda Motorcycle and Scooter India (HMSI) saw its bike sales decline by 15.6 per cent to 1,25,772 units as against 1,49,023 units in January last year. Scooter sales saw a modest growth of 7.85 per cent during the month at 4,36,707 units compared with 4,04,919 units in the same period of previous year.

HMSI saw its scooter sales rose 3.29 per cent at 2,35,967 units as against 2,28,479 units in the corresponding month last year. Hero MotoCorp sales rose 12.48 per cent to 86,649 units in January as against 77,033 units during the same period of previous year.
Chennai-based TVS Motor saw its scooter sales increase 7.64 per cent at 60,163 units in January as against 55,889 units in the same month last year.

Total two-wheeler sales in January rose 2.63 per cent to 13,62,881 units. Sales of commercial vehicles rose 17.53 per cent to 61,683 units in January, SIAM said. "The heavy commercial vehicle segment has shown strong growth during the month. The revival of mining activity has lead to the increase in demand in this segment," Mathur said.

Vehicle sales across categories registered an increase of 3.03 per cent to 17,00,257 units from 16,50,227 units in January 2015.