2020 for Indian Auto Sector: The year 2020 was a major setback for the country’s automobile sector. The COVID 19 epidemic and the ensuing lockdown caused major damage to the production and sales of the vehicle sector. But by the end of the year, the automobile sector is returning to the track again. COVID-19 After recovering from the crisis and being able to move forward, the Indian automobile sector is optimistic about 2021, taking precautions.
Before knocking out of the COVID 19 pandemic, the automobile industry was struggling with a downpour. After that, the nationwide lockdown imposed from March 25 to prevent and prevent the epidemic has completed its true task. The whole year passed under the shadow of the epidemic. But during this time the entire automobile industry learned a lot. The vehicle industry grew stronger overcoming challenges and increased focus on localization and digital.
Maruti sales were zero in April
The state of the automobile industry in India is gauged from the sale of passenger vehicles. In April 2020, the lockdown caused a major setback to the sales of automobile companies. Not a single car of Maruti Suzuki, the country’s largest car company, was sold this month. The lockdown began to slowly open from mid-May. Hence production and sale of vehicle companies also started. Sales of passenger vehicles declined by 78.43 per cent during the April-June quarter. Vehicle sales were hit for the ninth consecutive quarter and for the first time in 20 years, the sector had the longest moderation.
Loss of 2300 crores daily in lockdown
Recently, a committee of Parliament has informed that due to the lockdown, the country’s automobile industry suffered a loss of more than Rs 2300 crore per day. Also, about 3.45 lakh people are expected to get jobs in the area. Shops of 286 auto dealers have closed.
The auto market becomes digital
The major change in the country’s auto industry due to the Corona epidemic and the lockdown was that the car and two-wheeler market went digital. Various car companies, including Hyundai, Honda and two wheeler companies like Hero MotoCorp, Royal Enfield, Honda Two Wheeler etc. have introduced online booking and home delivery of vehicles to customers. The test drive of the vehicles was also given to the customers to meet at home, which ended the need to visit the vehicle showroom.
Maruti Suzuki started manufacturing ventilators, masks and many other safety accessories in factories locked in lockdown. In this way, Maruti contributed to the supply of things which were necessary during the time of crisis.
Subscription service expanded
After the lockdown opened, vehicle sales in the country started picking up gradually. Keeping in mind the social distancing, people gave priority to the movement of their vehicles. Taking advantage of this, the car subscription service also increased. Several car companies, including Maruti Suzuki, have extended the car subscription service to customers. A car subscription means that a person can drive a company’s car without renting it. During this time, he has to pay monthly fixed rent.
What is the hope for the year 2021
Regarding how the year 2021 will be for the auto industry, Rajesh Menon, director-general of the Society of India Automobile Manufacturers (SIAM), says that the demand for individual vehicles in times of crisis and the gradual opening of economic activity has given some momentum to the sector And it is. The industry is seeing signs of revival in some segments. Some segments gained momentum during the festivals, but overall the general economic scenario will determine the performance of the vehicle industry in the coming times.
Given the uncertainties in the market, RC Bhargava, chairman of Maruti Suzuki India, says that it is difficult to predict the future. But surely the next year will not be as bad as 2020. In the first quarter of the current financial year, the work was stopped. This made a big difference in the situation. Hopefully, the next year will be better than this year. But how much better it will be, what will be the target of sales, it remains to be seen.
According to Guenter Bushek, managing director and CEO of Tata Motors, both sales and production are expected to be better in 2021 with the economic revival. Hyundai Motor India Managing Director and CEO SS Kim says that there are definite signs of improvement in 2021. Rajesh Goyal, Senior Vice President and Director (Marketing and Sales), Honda Cars India, says that the health crisis is expected to continue for some time. In such a situation, demand for private vehicles is expected to increase. This will help the automobile industry to maintain growth momentum in the coming months.
ACMA President Deepak Jain, who represents the auto components industry, says a revival is expected in the next financial year after two difficult years 2019-20 and 2020-21. The Corona vaccine is expected to be available in 2021-22. This will improve consumer perception as well as supply-related perception. However, challenges like the availability of raw materials as well as an increase in commodity prices will affect the sector.