The automobile industry expressed concern that the fuel price hike announced on Wednesday could impact sales in the short-term.

"It is a very tough situation for us. As it is we are under tremendous pressure from rising input costs and high interest rates. Initially, in short-term it will have an impact on sales but in the long-term it will be taken into stride by consumers," Hyundai Motors India Senior Vice President Marketing and Sales Arvind Saxena told PTI.

He said as such the auto industry has been facing a difficult time, but going forward the focus would be on more fuel efficient and compact cars.

Echoing similar sentiments, country's largest carkmaker Maruti [Get Quote] Suzuki India said: "Initially car sales may dip but eventually they will be back on track. Customers will look for more fuel efficient cars."

Tata Motors [Get Quote] spokesperson said fuel price is a factor that impacts the auto industry.

The hike of Rs 3 per litre of diesel and Rs 5 on petrol comes at a time when the auto industry is trying to make a slow recovery from last year's slowdown. In fiscal 2007-08, the auto industry witnessed a decline of 4.7 per cent at 9,648,105 units, compared to 10,123,988 units in the previous fiscal.

A variety of factors such as high interest rates, non-availability of finance, specially for mtorcycles, had affected the growth of the sector last fiscal.

The industry was making a slow recovery this fiscal with many of the major manufacturers posting double digit growths. Industry experts, however, said too much should not be read into those figures as the base was low last year.

Most of the major manufacturers have predicted a flat or very marginal sales growth this fiscal.

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