The total number of vehicles sold (wholesale) in India between April 2019 and March 2019 stood at 21.55 million, as against 26.27 million in the same period the previous year, a decline of 17.76 per cent.
While the numbers for March 2020 are horrendous, this was on expected lines as many showrooms for all sorts of vehicles had shut their doors by the end of the first week of the month. And with factories shutting down a few days ahead of the nationwide lockdown, production tumbled as well.
The country’s largest carmaker, Maruti-Suzuki India Limited saw production down to 91,602 vehicles, a decline of 32.27 per cent in March 2020 compared to the same month last year, but domestic sales dropped 45.98 per cent to 78,344 units.
Across the board the numbers were terrible for the industry, and of all the larger manufacturers only Hyundai Motor India could claim that they did not have as bad a year as the others, with annual domestic wholesales declining just 10.99 per cent to 485,309 cars and the Korean manufacturer could even claim that they might have ended the year even as sales of the second-generation Creta launched just before the lockdown got stalled by recent events.
At the same time, new entrants such as Chinese manufacturer MG Motor could claim to have had a decent 2019-20 with sales of 21,954 units of their Hector SUV but the real winner of the year could be seen as Korean manufacturer Kia which sold 84,903 units of their Seltos SUV.
However, despite some success in the passenger vehicles segment, the true bloodbath happened in the commercial vehicles market. With the rollout of new BS6 vehicles making consumers question the need to buy new trucks as well as the unintended consequence of the Goods and Services Tax (GST) leading to higher efficiencies with existing fleets thanks to smoother border crossings, made even smoother with the widespread implementation of the FASTag at tollgates, saw cumulative commercial vehicles sales decline 28.75 per cent for the year 2019-20 and sales for the month of March collapsing 88 per cent.
The news for India’s large two-wheeler industry was also dismal. Overall sales for the year were down 17.76 per cent at just 17,417,616 units and March 2020 was the first month in almost a decade where total unit wholesales were under one million motorcycles. Every large manufacturer felt the pinch of declining domestic sales. The only silver lining for the entire Indian automotive industry was provided by the 7.3 per cent rise in two-wheeler exports from India to 3,520,376 units on the back of Bajaj Auto which contributed over half the export volume.
Industry sources do not expect sales to recover in 2020 after a dismal run of over 18 months since the last quarter of 2018.
The Federation of Auto Dealers Associations put together another appeal to the Prime Minister with a list of demands including a waiver of interest on loans during the lockdown period as well as interest subvention.
They also demanded that since the virus attack was a ‘health pandemic’ that the Employees State Insurance Corporation (ESIC) pay employees salaries. They also made some supply-side suggestions to boost demand in the wake of the pandemic such as a reduction of GST rates for cars, an extension of the depreciation benefits and a scrapage policy.
