This assumes significance as the industry was hopeful of maintaining a double digit growth during 1997-98. The only saving grace for the industry was a buoyant exports which grew at a rate of 25 per cent during last year.

According to the figures available with The Financial Express, the total sales of heavy commercial vehicles (HCVs) tyres and light commercial vehicle (LCVs) tyres declined to 65,35,000 in 1997-98 compared to 75,70,000 during the corresponding period previous year.

A cursory look at the sector-wise source of demand shows that while the major factor that hit the tyre sales last year was an over 50 per cent decline in the original equipment manufacturing (OEM) sector. While, the OEM sector, which grew at a rate of over 17 per cent during the previous year, registered a negativetwo per cent growth last year. The size of this segment grew from 14,79,000 in 1995-96 to 17,25,000 in 1996-97 but declined to 8,45,000 in 1997-98, registering a 51.04 per cent decline.

The replacement segment, however, posted a negative growth of only three per cent during the period. According to the figures, the segment had grown from 50,10,000 in 1995-96 to 58,45,000 in 1996-97, but slipped to 56,90,000 in the last fiscal, registering a negative 2.65 per cent growth.

However, sector-wise figures show that the replacement segment in HCV sector declined from 50,16,000 in 1996-97 to 4613,000 in 1997-98. In the MCV segment, however, there was an absolute increase from 829,000 in 1996-97 to 1077,000 in 1997-98. Sources explained that the drastic fall in the movement of trucks, following the recession in core sectors, was the major reason for the dip in tyre sales in the HCV segment. This also affected the rubber prices adversely, they added.

In the OEM segment too the sales of HCV tyres declineddrastically from 913,000 in 1996-97 to 515,000 in 1997-98, a decline of over 40 per cent. The LCV tyre sales also declined from 812,000 in 1996-97 to 329,000 in 1997-98. A major factor that threw the sales projections of the industry to the winds was apparently the drastic fall in the production and sales of heavy commercial vehicles. According to industry sources, the total sales of HCVs had declined by 34 per cent during the last fiscal. The sales of LCVs had also declined by 15 per cent, sources added.