Passenger car sales in India declined for the second consecutive fiscal as the segment saw a de-growth of 4.65 per cent. Though there is improvement from the 6.69 per cent decline (first decline in 10 years) for the segment recorded in Fy13, latest numbers paint a gloomy picture for the sector making its recovery process harder and longer.
“We have not done a calculation of how much job losses were there, but I personally feel that across the entire value chain in the auto industry, from raw materials to dealerships, there could be around 1-1.5 lakh job losses,” Society of Indian Automobile Manufacturers President Vikram Kirloskar said.
“Last year was one of the most difficult years for the industry. The business environment was tough due to low growth of economy, high interest rates, fuel prices and low sentiments,” Kirloskar said.
According to SIAM, domestic car sales in FY14 stood at 17,86,899 units as compared to 18,74,055 units in the previous fiscal.
In the 2012-13, car sales in India fell by 6.69 per cent, which was the first decline in a decade.
During the fiscal, total sales of vehicles across categories, however, were up 3.53 per cent in 2013-14 at 1,84,21,538 units as compared to 1,77,93,701 units in 2012-13, SIAM said.
Two-wheelers did well posting a growth of 7.31 per cent at 1,48,05,481 units as against 1,37,97,185 units in FY13.
Motorcycle sales in 2013-14 stood at 10,479,817 units as against 1,00,85,000 units in the previous year, up 3.91 per cent.
Scooters also posted a robust growth of 23.24 per cent during FY14 at 36,02,744 units as compared to 29,23,424 units in 2012-13.
Commercial vehicles, however, continued to reel under a prolonged slump, posting a decline of 20.23 per cent at 6,32,738 units as against 7,93,211 units in the earlier fiscal.
“The stalling of infrastructure development projects, ban in mining activities and overall slowdown in economy continued to hit the commercial vehicles segment,” Kirloskar said.
Interestingly, foreign car makers like Honda and Ford saw sales number increase to high double digits. But this had little bearing on the outcome for the sector due to their low volumes compares to bigger car makers.
He said that the industry hoped for ‘moderate growth’ or at least be in negative territory in FY15. Overall exports grew 7.21% in FY14 from 28,98,907 units to 31,07,893 units.
Terming revival of economy as crucial to the growth of automobile sector, Kirloskar evinced hope that new government, which comes to power after general elections next month, would come up with policies to ensure GDP expansion. (With agency inputs)