New Delhi: The passenger vehicle industry grew by 7.5% to 285,477 units in January on the back of improving macroeconomic indicators, low base effect and shift in customer demand towards utility vehicles like Vitara Brezza, Nexon and Creta. Utility vehicle sales during the month increased by 37.8% to 85,850 units, according to industry lobby Society of Indian Automobile manufacturers (Siam).

Passenger car sales though continued to move southward and declined by 1.2% to 184,264 units because of increasing demand for compact UVs.

Motorcycle sales increased by 28.64% to 1,054,062 units as sales of economy and executive segment offerings in the rural markets picked up due to improvement in the rural economy after two consecutive years of good monsoon and low base effect.

Scooter sales grew by a huge 48.29% to 55,369 units as a result of shifting demand towards scooters from entry-segment motorcycles in urban markets.

Total two-wheeler sales increased by 33.4%1,684,066 units.

Medium and heavy commercial vehicle sales during the month increased by 18.77% to 34,170 units due to a pick-up in construction and mining activity.

“With the improvement in the macroeconomic situation we expect vehicle sales to improve across segments. Passenger car sales continued to decline as a result of shift in customer demand towards compact SUVs," said Sugato Sen, deputy director general, Siam.