India’s Tata Motors really hit its stride in 2008, first unveiling its $2,500 Nano city car, then acquiring Jaguar and Land Rover from Ford and finishing up with a major sponsorship role in Ferrari ’s Formula One efforts. But despite that seeming success, the global economic downturn hasn’t left Tata alone, resulting in a sales collapse during the month of December.
Although India is best known as an ever-expanding market, the crumbling global economy and tightening credit market really took its toll on December sales. Tata’s passenger car sales plummeted 31 percent while its commercial division saw a 51 percent reduction in sales. Overall, Tata’s December sales totaled just 25,219 units, 47 percent decrease from December 2007, according to Reuters.
“A deepening recessionary trend in the economy, coupled with continuing credit squeeze and high interest rates, has further depressed customer sentiments,” Tata said in a statement. “As a result, automobile purchases are being severely impacted.”
With the exception of Hyundai – which posted an impressive 56 percent sales gain during the month of December – India’s December sales were down across the board. Maruti Suzuki India – India’s largest automaker and Suzuki’s Indian division – saw a 10 percent decline in sales while Tata’s rival, Mahindra & Mahindra saw sales slide by 30 percent.
The downward trend in developing regions such as India is a serious concern for the world’s automakers. Developing regions have been the lone bright spot for many car makers as sales in more mature regions have been less than stellar.
