Face of Nation : Finance Minister Nirmala Sitharaman right this moment mentioned millennials’ desire for Uber and Ola cabs over committing cash to EMIs for brand spanking new automobiles had contributed to the slowdown of the auto sector, which has additionally seen a 70 per cent drop in gross sales for truck producer Ashok Leyland, and to the lack of lakhs of jobs throughout the nation. The minister mentioned the centre was actively working to unravel the disaster within the car sector and was “constantly interacting with different segments” to resolve the problem.
“Automobile sector, in particular, has been affected by several things. These include BS6 (Bharat Stage 6) movement, the registration fee issue that has been deferred till June and the mindset of millennials, who are now preferring not to commit EMIs to buying automobiles but prefer to use Ola or Uber or take the metro,” Ms Sitharaman mentioned.
“All of us are constantly interacting with different sectors and economic segments… not just in Delhi but taking inputs from around the country,” the minister, in Chennai to focus on achievements of 100 days of the Narendra Modi authorities’s second time period in energy, added. Auto producers are reeling from one of many worst slowdowns within the historical past of the business.
Hero MotoCorp, India’s largest two-wheeler producer, reported a 20 per cent drop in gross sales final month. Maruti Suzuki suffered a 34 per cent discount in gross sales for a similar interval. Gross sales of vans and business autos have additionally been badly hit, with Ashok Leyland reporting an enormous 70 per cent drop in gross sales on Tuesday.
Final month, in an effort to assist enhance gross sales, Ms Sitharaman introduced a lot of measures, together with ordering authorities departments to purchase new automobiles to interchange outdated ones; there had beforehand been a ban on buy of latest automobiles.
She additionally deferred, until June 2020, a hike in automobile registration price, and clarified that BS IV autos bought as much as March 31, 2020, can be allowed to run regardless of the federal government introducing the stricter BS VI norms.
The troubled auto business has additionally requested for a reduce in a GST fee from 28 per cent to 18 per cent. Nevertheless, the Finance Minister declined to touch upon that request right this moment, solely saying “I cannot singularly take a decision on GST”.
The auto sector has mentioned it’s “cautiously optimistic” that gross sales will enhance, highlighting the steps the federal government has taken. Nevertheless, passenger automobile sellers have warned that until the enhancements occur within the subsequent 4 months, the state of affairs may go from dangerous to worse.
