5 percent year-on-year in May, industry data showed on Wednesday, as new launches boosted demand. A total of 148,481 vehicles were sold in May, up from 113,810 a year earlier, data from the Society of Indian Automobile Manufacturers (SIAM) showed.
Market leader Maruti Suzuki continued to post higher sales of hatchbacks A-Star, Ritz and Swift along with rival Hyundai, whose sales for the i10 and i20 also rose.
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Other car makers Ford Motors, General Motors and Volkswagen AG also saw demand for their new launches rise.
Car sales have been on the rise in Asia's third-largest automobile market due to inexpensive loans, new models and a recovery in demand.
Sales for India's largest passenger car maker Maruti Suzuki rose 21 percent to 76,120 cars in May from a year earlier.
Hyundai, which trails Maruti in sales, sold 27,151 cars in May, up 15.5 percent from a year earlier.
Sales of trucks and buses, a barometer of economic activity, rocketed by 58 percent to 48,580 units in May, SIAM said.
The Indian auto market is forecast to triple over the next decade to six m