Domestic PV sales fall by 50% in June
New Delhi: Domestic passenger vehicle sales halved in June compared to the same period last year, owing to the economic turbulence caused by the Coronavirus crisis.
Accordingly, 105,617 passenger vehicles were sold in June 2020 in India, 49.59 per cent lower than the 209,522 units sold during the corresponding period in 2019.
According to data released by the Society of Indian Automobile Manufacturers (SIAM), car sales in the country plunged 57.98 per cent to 55,497 units last month compared to 132,077 units during June last year.
In a technical footnote, SIAM said the data does not include sales figures from some key players such as Tata Motors.
Three-wheeler sales stood at 10,300 units, 80.15 per cent lower on a year-on-year basis.
In terms of two-wheelers, which include scooters, motorcycles and mopeds, the sales edged lower by 38.56 per cent to 1,013,431 units.
Data showed that total production of passenger vehicles, three-wheelers, two-wheelers and quadricycles in the month of June decreased by 51.44 per cent to 1,094,363 units.
With the automobile industry growing through the longest sales slump, made worse by Coronavirus pandemic, auto industry body SIAM President Rajan Wadhera on Tuesday said he does not see any case for investment in the auto sector at present.
Among the casualties of the current situation will be electric vehicles, where companies are no longer in a position to invest in the new technology and it would need government support for India not to miss the EV revolution, he added.
Speaking to reporters via video conference, Wadhera said after the lockdown relaxations automobile manufacturers have slowly started production but capacity utilisation remained very low.
"It will take another three to four years to reach the peak level of 2018. So right now there is enough capacity in the sector and hence no investment is needed there. Moreover, the auto industry has invested heavily for the transition to BS-VI emission norms in a very short span of three years," Wadhera said.
He further said this year the auto sector is looking at a decline of 26-45 per cent depending on the vehicle category.
"Coupled with that of last year, we are looking at a decline of 50 per cent in two years. When the demand is half, I don't see any case for investment in the sector," Wadhera said responding to a query on how the slowdown and COVID-19 will impact investments.
When asked how the EV story will pan out in India due to the current circumstances and if OEM (original equipment manufacturer) will rethink their plans for the same, he said: "You can't keep on borrowing money and investing. Even if you want to, if you do not have revenue you cannot invest." Admitting that EV plans have taken a back seat for many manufacturers, he said it is not "affordable" for the industry to invest in it at the moment.
While India has been promoting EV, Wadhera said there is a need for a dialogue with the government for proper long term planning and for providing support to the industry and creating the infrastructure so that the country does not miss out on the "EV bus".
On self-reliance, Wadhera said around 70 per cent of the components have been localised but due to the migration to BS-VI emission norms imports of certain parts have increased in the range of 1-6 per cent and these will continue till the time domestic components manufacturers develop expertise and scale for the same.
