There’s a lot of news rushing in from the automobile sector. Nonetheless, the government and the finance minister have been trying very hard to lift up the terrible automobile slump that is going on in the Indian economy. Not only have it brought down sales to a significant level, it has also rendered multitudes off their jobs.
Some time back, the govt had planned on shifting the automobile sector towards electric vehicles. Unfortunately, looking at the grim picture of the current situation, the government clarified on Thursday that petrol and diesel vehicles shall not be banned and Sitharaman has added her share of help by putting up a 15% reduction in taxes of all vehicles and registration of BSVI vehicles.
Despite of trying hard and taking several measures, India’s automobile industry is showing no sign of recovery and just depreciating. In fact, India’s monthly passenger vehicle and car sales recorded their steepest fall ever in August since 199-98.
Govt to Ease on Vehicle Taxes and Won’t Ban Petrol-Diesel Vehicles
The ongoing battle for car sales is not showing any signs of improvement. The pandemonic slump in automobile demand and sales in the country, has reached it brim now. People are getting fired and vehicles are lying unsold in the factories. To ease off the situation, the Union minister for road transport and highways, Nitin Gadkari clarified that petrol and diesel vehicles will not be banned for replacing them with electric vehicles.
He was informed by auto experts that the rise in prices of vehicles was due to BSVI compliant engine, adding that the govt too may consider the reduction of GST temporarily. In order to tackle this problem, The industry has sought a relaxation of GST on vehicles due to the extra cost incurred for the transition from BSIV to BSVI compliant engine.
- making auto loans cheaper
- lifting the ban on purchase of new vehicles for replacing old government vehicles
- deferring of one-time registration fees till June 2020
15% depreciation on all vehicles and operation of BSIV vehicles or their entire
period of registration.
Along with these measures, Gadkari assured that his ministry would launch out 68 road projects costing up to Rs 5 lakh crore in the next three months to help boost up demand for commercial vehicles.
Passenger Vehicles Sale Fall Worst Since 1997-98
India’s monthly passenger vehicle and car sales recorded their steepest fall ever in August highlighting the continued slowdown in the sector. It recorded the worst decline since 1997-98, as per the Society of Indian Automobile Manufacturers (SIAM).
Passenger vehicle sales fell 31.57% year-on-year to 196,524 units in August, for 10 straight months, while passenger car sales fell 41.09% to 115,957 units, as compared to 196,847 sold in the same month last year.
- Utility vehicles sales saw a decline of 2.2%, selling 71,478 units as compared to 73,085 last year.
- The van segment recorded a scary drop of 47.36%, selling only 9,089 units, while last year’s number was 17,266 units.
- Two-wheeler sales saw a decline of 22.24% with 1,514,196 units sold this year, against 1,947,304 sold in August 2018.
- Medium and heavy commercial vehicle sales declined by 54.3% with 15,573 units sold compared to 34,073 units last year.
- Light commercial vehicle sales fell down by 28.21% with 36,324 units sold compared to 50,595 units last year.
To frame a bigger picture, the Indian auto sector sold 9,732,040 units of vehicles in August 2019 compared to 11,570,401 units in August 2018, which is a decline of 15.89%.