The Covid-19 crisis has resulted in very sharp brakes being applied to the Auto industry. This has been never seen before. This also has been accompanied by the BS6 emission norms which have not affected the sales but have put the automakers and dealers in a spot. As we see the lockdown easing off we can see some growth in the sales of the vehicle by the end of May. But it has seen a 87% drop as compared to last year. This data has been revealed by the FADA – Federation of Automobile dealers association.
By the end of May, 26,500 showroom outlet and 60% of showrooms are open. 80% of the workshops have resumed. Although this might be true about the production end the purchase side of the vehicles is not showing signs of a bounce back.
As compared to last year the sales of passenger vehicles have seen a massive decline of 87%. The main reason of surprise is this crisis will create anxiety among the minds of people for travelling with public transport.
Reopening of showrooms
Almost all automakers have opened their showrooms and service centres. Out of 26,500 outlets, about 60% of showrooms and 80% of workshops resumed operations across the country. FADA President, Mr Ashish Harsharaj Kale said, “With an assumption of no further lockdown and continued reopening measures, there will be substantial pick up in retail sales of automobiles in comparison to May, but the overall outlook continues to be grim with projected sales to witness a decline of more than 25% compared to last year”
This Coronavirus crisis has also affected the sales of Commercial vehicles. According to FADA – Federation of Automobile dealers association, the decline of the commercial vehicle is even more at 96.63%. There have been only 2711 units of sales of commercial units.
The sales of the two-wheelers have dropped by 88.8%. We expect that there will be a rise in the sales of two-wheelers as the buying of a two-wheeler will be the first alternative for a person who does not want to use public transport.
“Demand in urban markets will continue to face challenges ahead with Covid-19 uncertainty…the Government’s push for infrastructure spending and the recent positive measures announced for agriculture sector will help support rural demand,” said Kale. This drop in sales of the vehicle is temporary and will gain momentum as the coronavirus crisis are averted. However, if India goes to another set of lockdown then it will be the same story again.