The Society of Indian Automobile Manufacturers (SIAM), the representative body of the domestic automobile industry in India, in presentations made to the government has cautioned that, if the Indian economy contracts by two percent during the fiscal year 2020-21 due to the impact of the Covid-19 pandemic, sales of cars, trucks and two-wheelers will fall by 45 percent during the year compared to sales volumes in the previous fiscal year, sources in the industry said on Wednesday, May 13.
SIAM made several projections to the government seeking help to tide over the impact of the pandemic and in one scenario forecast that, if the economy grows by two to three percent, automobile sales would decline by 20 percent during the year.
Even before the pandemic, the Indian auto industry was reeling, with sales of cars, SUVs and two wheelers falling by 18 percent to 21.5 million due to the economic slowdown and a decline of 45 percent in the current year would cripple the domestic industry, SIAM has told the government.
The domestic industry has sought cuts in the Goods and Service Tax (GST) and a year-long deferment of the government’s imposition of safety and fuel norms, bank credit at concessional rates of interest, and the lowering of the cost of ownership of cars by consumers.