Auto industry’s longest period of recession in 20 years, also decline for ninth consecutive quarter: SIAM

Abstract

  • Sales of passenger vehicles declined by 78.43 percent in the first quarter (April-June 2020) of the current financial year.
  • Siam, the organization of the auto industry, has said that this is the longest period of slowdown in the industry in the last 20 years.

The automobile industry has been badly affected by the epidemic. Vehicle sales have been severely affected due to the enforced lockdown since the last week of March. For the first time in the history of the automobile industry in India, not a single car was sold in April. Now data from the Society of Indian Automobile Manufacturers (SIAM), Society of Indian Automobile Manufacturers (SIAM) is stating that this is the ninth consecutive quarter when vehicle sales have registered a decline.
In the Covid-19 epidemic-affected market, passenger vehicle sales declined by 78.43 percent in the first quarter (April – June 2020) of the current financial year. Giving this information on Tuesday, the organization of the auto industry said that this is the longest period of slowdown in the industry in the last 20 years.

According to SIAM, commercial vehicle sales fell by 84.81 percent. This is the fifth consecutive quarter of decline in commercial vehicles. In this segment too, the last 15 years have never seen such a slow slowness.
Sales of passenger vehicles in the first quarter of the year (April-June 2020) stood at 1,53,734 units as compared to 7,12,684 units in the same quarter a year ago. Prior to this, the longest period of decline in sales of passenger vehicles in the last 20 years was for five quarters between 2013-14 and 2014-15 and between 2000-01 to 2001-2002.

Similarly, in the case of commercial vehicles, sales during the first quarter stood at 31,636 units as against 2,08,310 units in the same period a year ago. Prior to this, sales fell for eight consecutive quarters from 2013-14 to 2014-15.
“We are currently going through a very difficult phase due to corona virus. We were facing a shortage of demand since last year but Kovid in this quarter,” SIAM Chairman Rajan Vadhera said in a press conference organized through video conferencing. Business is down due to the -19. This is going to be very difficult for the vehicle industry. ”

“Therefore, the government needs to give a strong stimulus package to the automobile sector as the government did in the pre-recession period,” said Vadhera. He reiterated the long pending demand of the auto industry that the Goods and Services Tax (GST) for the vehicle industry should be reduced by 10 per cent for all categories of vehicles. Along with this, incentive-based scrap scheme should be started to increase the demand in the region.
In response to a question, Vadhera said that the members of SIAM have started production but they are facing difficulties in many cases. There are bottlenecks in the supply chain. Many factories are in places where restrictions due to Kovid-19 are in force. There is a shortage of workers. Clearing of import goods is delayed. Covid-19 cases have emerged around some of the members’ factories also causing trouble.
Sales of passenger vehicles in June were down by 49.59 percent to 1,05,617 cars from the same month a year earlier. In June last year, 2,09,522 passenger vehicles were sold. During this period, the largest car company Maruti Suzuki (Maruti Suzuki) sold 51,274 cars, which was 49.61 percent less than a year ago. Hyundai Motors (Hyundai Motors) sold 21,320 cars while Mahindra and Mahindra (Mahindra & Mahindra sold 8,075 vehicles. Their sales fell by 49.25 and 54.54 per cent respectively.
During this period, two-wheeler sales declined by 38.56 per cent to 10,13,431 units from 16,49,475 units in the same month a year ago. Motorcycle sales in two-wheelers stood at 7,02,970 units in June 2020 as compared to 10,84,596 motorcycles sold in the same month a year ago. It was down by 35.19 percent. Scooter sales fell from 5,12,626 to 2,69,811 during the period. The decline was 47.37 percent.