New Delhi: Indian automotive industry which has been experiencing its worst downturn in over two decades will not see the normal growth return anytime before the first half of the 2021, experts at ETAuto FBLive said on Thursday.
In a panel discussion organised by ETAuto on ‘How far is the recovery for auto industry’, Pankaj Dubey, MD, Polaris India opined that the market is still unpredictable and real growth can be seen earliest by 2021 given that the transition from BS-IV to BS-VI compliant vehicles is smooth.
The industry is directed to replace all the BS-IV compliant vehicles with BS-VI by April 1, 2020.
Resonating Dubey’s views, Arun Malhotra, auto industry expert mentioned positive sentiments are likely to be in play as the government has started acknowledging the challenges posed for the industry and taking action on it.
“Government is not in denial mode anymore and is taking action. Moreover, monsoon has been good which will further give impetus to improvement in tractor industry,” Malhotra said. Rural economy is expected to revive on better tractor sales.
As per SIAM data, more than 3 lakh vehicles were sold in a month on an average before the automotive industry went into downward spiral which has almost halved this year. August 2019 sales saw the steepest decline of 23.5 per cent across categories to 1.8 lakh units.
Government is not in denial mode anymore and is taking action. Moreover, monsoon has been good which will further give impetus to improvement in tractor industry.Arun Malhotra, auto industry expert
Garima Misra, MD, Group Landmark reveals that there has been 20% cancellation in bookings of vehicles due to financial approval.
She believes, it will take another year for the sales numbers to bounce back. According to her, retails sales have seen some greenshoots with the onset of the festive period this year. “While the retail numbers are still down year-on-year, the number of inquiries and walk-ins have increased in Navratra period which is a positive sign,” said Misra.
Apart from the smooth roll out for BS-VI and boost in festive season, the companies need to adopt newer methods to steer forward the growth.
Having an agile approach in product portfolio planning have taken a back seat , said Vinay Piparsania, Global Consulting Director – Automotive, Counterpoint Research. “A lot of energy has gone into introducing mandatory safety features among the existing portfolio than coming up with plans to make these products more appealing. This adjustment will take some time,” Piparsania said underlining that new products are more intriguing to the customers.
While the industry has been dealing with slowdown blues, new entrant to Indian market, MG Motor seems to be bucking the trend with 28,000 bookings accepted for its SUV Hector. Another debutant, Kia Motors also received 40,000 bookings for its SUV Seltos, giving out a clear indication of consumer’s inclination towards new products.