India Car Sales Plunge By a Quarter as Credit Crunch Bites

Indian car sales fell by nearly a quarter last month — marking one of the industry’s worst slumps in more than a decade — as a credit crunch squeezes consumption across the country, the Financial Times reported. Car sales of 139,628 for June were down 24 per cent on the same period last year, according to the Society of Indian Automobile Manufacturers, extending a run of three months of declines of 20 per cent or more. Sales fell 26 per cent in May. At the heart of the pain is a liquidity squeeze whose effect has started to show up in India’s industrial and economic data. The problem started after a high-profile default in India’s non-bank finance sector late last year, which prompted credit growth to shrink and left consumers with fewer avenues to finance large purchases such as cars or houses. Read more