Coronavirus Adds To India’s Auto Slowdown As Sales Slump Further In February
Coronavirus is seen affecting footfalls at dealerships and production of BS-VI vehicles in the coming weeks, SIAM President says.
Sales of cars and utility vehicles continued to decline in February as India’s worst auto slowdown in almost two decades showed no signs of recovery.
Domestic sales of passenger vehicles tumbled 7.61 percent year-on-year to 251,516 units in February, according to data released by industry body Society of Indian Automobile Manufacturers.
Car sales fell 8.77 percent to 156,285 units while sales of utility vehicles rose 0.10 percent year-on-year to 83,351 units in February. Monthly factory-gate shipments of commercial vehicles fell the most across categories—32.90 percent year-on-year to 58,670 units.
Here’s a segment-wise break-up of auto sales in February:
- Scooter sales fell 14.27 percent over last year to 422,310 units.
- Motorcycle sales declined 22.02 percent year-on-year to 816,679 units.
- Total two-wheeler sales fell 19.82 percent year-on-year to 1,294,791 units.
- Three-wheeler sales too declined 31.02 percent to 41,300 units.
SIAM President Rajan Wadhera said the decline in wholesale dispatches is primarily due to economic slowdown and lowered production of BS-IV vehicles. He said that some upside on retail sales—measured by vehicle registrations at dealerships—can be attributed to last-minute purchases of BS-IV vehicles.
Auto and auto component makers, which together contribute more than 7 percent to India’s gross domestic product, have been forced to lay off contract workers, and dealerships shut showrooms, as Indians cut back spending amid an economic slump. The slowing consumption has dragged India’s GDP growth rate to the lowest in more than a decade.
The novel coronavirus outbreak has added to the woes and is seen affecting footfalls at dealerships and production of Bharat stage VI-compliant vehicles in the coming weeks. “Supply chain disruption from China is also a concern, which may impact the production plans for companies going forward,” Wadhera said.
SIAM had earlier estimated that a disruption in availability of raw material from China is likely to critically hamper production across all segments and gravely affect electric vehicles.