Car sales in the first month of the fiscal have been lukewarm. This is largely because of subdued sentiments after prices were raised in March following tax hikes announced in the Budget.

With petrol prices expected to rise further, diesel models continued to drive growth for most players.

Boosted by the success of its new Ertiga MPV and the Swift range, market leader Maruti Suzuki sold 4 per cent more cars at home in April.

Mr Shashank Srivastava, Maruti's Chief General Manager of Marketing, told Business Line that the first quarter usually sees a dip as dealers stock up in March and companies are yet to open their books for fresh purchases.

March passenger vehicle wholesales (sales to dealers) were up 21 per cent (2.92 lakh units).

Many had advanced purchases to February and March. Apart from excise duties, road tax also went up in Maharashtra and Kerala. Entry tax is up in West Bengal and Madhya Pradesh, he said.

While rival Hyundai is yet to report numbers, Tata Motors saw sales dip 3 per cent. Mahindra's strong diesel portfolio led to a 33 per cent rise, while the Brio and new City sedan boosted Honda Siel's sales three-and-a-half times (7,075 units).

We expect recovery only after six months and that too if the interest rates come down substantially, Mr Vishnu Mathur, Director-General, Society of Indian Automobile Manufacturers, said.

General Motors and Ford both posted a decline of 20 per cent (8,005 units) and 2 per cent, respectively.