NEW DELHI: Highlighting a deep slowdown in the Indian automobile market, car and SUV sales fell for the seventh straight month in May as economic uncertainty, pressure on jobs and difficult financing saw buyers stay away from new purchases.

Of the last 11 months ending May 2019, sales of passenger vehicles — comprising cars, SUVs and vans — have fallen for 10, except in October 2018 when they had grown by 1.5%. (Full monthly numbers for May 2019 are still not available as some of the smaller companies are yet to announce their sales).

Maruti, which accounts for one of every two cars sold in the country, saw volumes crash by 25% in May. For the country’s largest carmaker, this is the third month in a row when volumes have been in the negative.

Maruti chairman R C Bhargava has already said that he expects the pressure to continue, adding that the market is not likely to bounce back soon.

The general elections that stretched for over a month and the slowdown in the economy saw buyers shun new purchases even though companies offered attractive discounts and launched new models.

Companies are correcting inventory at dealerships which are currently overflowing with unsold stocks.

Mahindra and Mahindra, which saw a marginal 1% dip in May sales, said that stock correction is being done. “While consumer sentiment and demand continued to be subdued during the pre-election phase, our focus has been on correcting the channel inventory,” Rajan Wadhera, president of Mahindra’s automotive division, said.

Industry analysts say that with the industry preparing for the transition towards stricter BS-6 emission norms from April next year, the situation will continue to remain challenging. Also, a spike in fuel prices will further dampen demand.

Rajesh Goel, director (sales and marketing) at Honda Cars India , said difficult days for the auto industry are not going away soon. “The market continues to be tough… It is unprecedented in the last two decades. After elections, we were expecting an upswing which has not yet come.”

Goel blamed factors such as liquidity crunch and higher fuel prices to be challenging. “We are still hopeful that demand will revive due to pent-up demand, favourable indicators on monsoon and expected actions by the new government.”

With metro markets remaining weak and rural distress rising, the pressure on consumption is aggravating. This can be gauged by the pressure on the numbers in two-wheelers, a category that has also slipped into the red in the past few months.

Scooters, which generally find strong traction in the urban markets, slipped into the red for the first time in 13 years in 2018-19, and began the new fiscal with a 26% fall in April. On the other hand, motorcycles — which provide the bulk of volumes to two-wheeler numbers — were down by 12%.

Vishnu Mathur, director general at industry body Siam, said that the industry expects a respite from the slowdown as government formation at the Centre gets completed. “There is uncertainty at this moment… we still have variables to tackle.”

