The recent measures announced by the government to help the auto industry overcome the ongoing slowdown is yet to take effect at ground level and uncertainty over GST reduction is making customers postpone purchases, automobile dealers body FADA said on Tuesday. The Federation of Automobile Dealers Association (FADA) however said it was cautiously optimistic about retail sales to be either flat or marginally positive during this festive season compared to last year when there was degrowth.
in August, the Indian automotive industry received a much-needed push from the government to get the ball rolling and have the cash counters ringing once again as Finance Minister Nirmala Sitharaman announced several measures to help the industry. This comes at a time when the entire automotive sector in India is ailing with a slowdown that has resulted in it touching a 19-year low in terms of sales. This has been spread throughout the segments including passenger vehicles as well as commercial vehicles, with component manufacturers feeling the pinch as well. As per reports, since April 2019, there have been over 3.5 lakh layoffs across the industry with the situation only set to get worse.
Currently, the Indian automotive sector has been going through one of its worst slowdowns in history manufacturers across segments, including cars, motorcycles and scooters, reporting a steep decline in sales when compared to Year-on-Year sales. As a result, the entire Passenger Vehicle and Commercial Vehicle industry have seen a decline in sales with inventory piling up with dealers across the country. To give you a perspective, as per the numbers, the slowdown has been the worst in the last 19 years which has resulted in over 15,000 job losses in the past three months alone. There have also been reports that automakers, parts manufacturers and dealers have laid off over 3.5 lakh workers since April 2019.
As per the data that was recently released by the Society of Indian Automobile Manufacturers (SIAM), vehicle sales across categories, including passenger vehicles (PVs) and two-wheelers, stood at 18,25,148 units last month as against 22,45,223 units in July 2018. The previous biggest decline across overall domestic automobile sales was recorded in December 2000 when it fell 21.81 per cent.
(With inputs from PTI)