The export of cars from India registered 18.6 per cent year-on-year (Y-o-Y) growth amid strong demand in key markets.

According to data released by Society of Indian Automobile Manufacturers (SIAM) on Friday, the exports increased to 180,483 units in the first quarter of 2023-24.

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The domestic sales of cars remained flat at 1.026 million units, recording a growth of just three per cent Y-o-Y. (Monthly figure does not include data for Tata Motors).

One reason for the continuing drop in overall domestic sales is low demand for smaller cars. The domestic sales of smaller cars – sedans and hatchbacks included – dropped by 17.5 per cent Y-o-Y to 341,293 units in June, the data said.

Speaking on the low growth in domestic sales, SIAM president Vinod Aggarwal, said, “We should not read too much into this monthly data. It is a moderate growth. Let us see what happens in the balance part of the year.”

With a positive outlook for monsoon and the upcoming festive season, the expectation is for good growth, he added.

On dealers’ complaints in the last few weeks about high levels of stocks with them, he said it is not a cause of worry.

“I am sure there is a good equilibrium between demand and supply. We should not worry too much about stocks. Companies will take necessary corrective measures to keep a balance,” he said.

“If the dealer is healthy, the company is healthy. At the level of association, we do not get into it…Sometimes you (company) produce more, sometimes you produce less. These ups and downs keep happening. I do not think there is any concern related to that.”

On the sales of electric cars, Aggarwal said: “We should be careful while using the words like ‘revival’ for EVs. This is a new segment. This has not been in the market long enough to be judged. Some slowdown may be happening. But it would grow, especially after the budget, wherein we expect some incentives for this segment.”

Notably, in June, the electric car sales observed a drop Y-o-Y.