What is in store for the auto industry?

ET Online|
"Flat" industry
1/5

"Flat" industry

As the coronavirus pandemic spreads across the world, the battered auto sector shouldn’t look for signs of recovery yet. According to a PTI report, the domestic automobile industry is headed for another year of double-digit sales decline this fiscal, given the extended lockdown to contain the COVID-19 pandemic, Crisil Research said on Friday.

Agencies
Plunging numbers
2/5

Plunging numbers

Overall sales volume would plunge to multi-year lows, with sales of both passenger and commercial vehicles reaching fiscal 2010 levels, the report said. For the full fiscal, sales of passenger vehicles (PVs) are expected to decline 24-26 per cent as compared with a 21-23 per cent contraction for two-wheelers, according to Crisil Research. Commercial vehicles (CVs) sales are expected to decline by 26-28 per cent. However, contraction in tractor sales in the current fiscal is expected to be around 7-9 per cent only, it added.

Agencies
Income sentiment down
3/5

Income sentiment down

"Automobile sales are running out of steam as urban income sentiment wilts under the pandemic. We assessed around 26,000 companies that have a total employee cost of Rs 7 lakh crore," Hetal Gandhi, Director, Crisil Research said at a webinar jointly hosted with Crisil Ratings.

Agencies
Double whammy
4/5

Double whammy

According to Crisil Research, what started as a supply-side pain has quickly engulfed the demand side too, with job loss and pay cut fear dampening consumer sentiment. A recovery in demand is expected only from the festival season in the third quarter of this fiscal, and largely for two-wheelers and tractors, which have a higher rural share.

Reuters
Car sales down
5/5

Car sales down

PVs, a big-ticket item with a replacement share of 60-70 per cent, are expected to see purchasing decisions postponed. That's also because the segment has a high finance penetration of 78-80 per cent, and given the income uncertainty, fewer consumers would be willing to take a loan, it said.

TNN

Other useful Links


Copyright © 2020 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service

X
User