New Delhi: The ongoing consumption slowdown that has gripped the Indian economy dragged down automobile industry August sales to their lowest level since 1997-98, data showed on Monday.
The ongoing consumption slowdown that has gripped the Indian economy dragged down automobile industry August sales to their lowest level since 1997-98, data showed on Monday.
India's domestic passenger vehicle sales fell for the tenth straight month in August, declining 31.57 per cent to 1,96,524 units from 2,87,198 units in the year-ago period.
Domestic car sales were down 41.09 per cent to 1,15,957 units as against 1,96,847 units in August 2018, according to data released by the Society of Indian Automobile Manufacturers (SIAM) released on Monday.
Motorcycle sales last month declined 22.33 per cent to 9,37,486 units as against 12,07,005 units a year earlier.
Total two-wheeler sales in August declined 22.24 per cent to 15,14,196 units compared to 19,47,304 units in the year-ago month.
Sales of commercial vehicles were down 38.71 per cent to 51,897 units in August, SIAM said.
Vehicle sales across categories registered a decline of 23.55 per cent to 18,21,490 units from 23,82,436 units in August 2018, it added.
In fact, all vehicle categories witnessed a decline in sales during the month.
Mr Rajan Wadhera, President, SIAM said that the sales report coming out from various companies for the month of August 2019 has been very dismal with over 30% erosion of sales for Passenger Vehicles.
The Commercial Vehicle and Two-wheeler sales are also significantly negative indicating that the market has still not responded to the various measures initiated by the Hon’ble Finance Minister last month.
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The series of announcements on credit availability and reducing the cost of credit that were made do not seem to have percolated down to the NBFCs which support the bulk of finance for the automotive industry.
The consumer sentiment also continues to be low and there is clearly a trust deficit in lending money to the dealers.
All this while, the Industry has pulled out all stops in offering attractive deals and discounts to the consumers.
However, the ability of the industry to provide large discounts is limited and this only highlights the need for Government to consider reducing the GST rates from 28% to 18% which would significantly reduce the cost of vehicles and in turn create demand.
There is also an urgent need to come out with an integrated Incentive-based Scrappage policy covering all segments of the Auto Industry as promised by the Hon’ble Finance Minister.
As the festival season is around the corner, it is imperative that these decisions are taken quickly and announced without delay so that the industry could hope for a better festival season that could harbinger a recovery in the industry, emphasised Mr Rajan Wadhera, President, SIAM.
