News By/Courtesy: Ragini M | 29 Jul 2020 13:24pm IST

HIGHLIGHTS

  • The impact of the coronavirus pandemic and lockdown, it triggered is seen in financial markets. But there is a deeper impact across the business and industrial sectors.
  • The supply disruption from china
  • It is estimated that over 25000 executives working at India Auto Inc are currently been working from Home to contain the spread of coronavirus contagion.

COVID-19 Impact on the automobile industry

The impact of the coronavirus pandemic and lockdown, it triggered is seen in financial markets. But there is a deeper impact across the business and industrial sectors. The impact analysis of the auto sector is made based on the assessments made by different analysts and industry.


>> The supply disruption from china


27 percent of Indian's automotive part imports and major globe auto part makers such as Robert Bosch GmbH, ZF Friedrichshafen AG, and Valeo id from China and have factories located in the Hubei Province. Owning to the closure of these factories of the companies has reportedly been a delay in the production and delivery of vehicles like Bharat stage Four complaint models.


JM financial said " despite the ongoing slowdown in economic activity amid coronavirus, the medium-term outlook for tractor sales remains positive. That is driven by the strong rabi output good reservoirs levels and expectation of normal monsoon in CY20. It also said the tractor industry will recover ahead of PVs flowed by 2Ws and CVs.

>> Impact on the demand


All OEMs witnessed a sharp drop in wholesale dude to the COVID-19 crisis and the lockdown. In march 2020 the supply chain completely disrupted and production halt in the latter half of the month.


MSIL dispatched c.77000 units in the domestic market with sales declining 48% YOY, sales of Toyota/Hyundai declined from 45% to 41%. The 2ws, OEMs faced issue over existing BSIV inventory with dealers that was exacerbated by coronavirus crisis and limited relief from SC on sale of BSIV inventory.


The most impacted sales were MHCV sales, due to the planned BSVI transition in the latter half of March and early April. According to the Fitch solutions Report production in India has likely to contract by 8.3 percent in 2020 following an estimated 13.2 % decline in the year2019. It also said that the coronavirus crisis also makes the transition to BSVI emission norms difficult

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>> Outlook for the auto sector


HDFC Securities, In the medium term the auto industry in India is expected to witness multiple disruptions. From mobility services and electric vehicles. It said that EVs are at the start-up stage of S-curve while shared mobility is in the growth stage. Sustained Profitability is essential to ensure long term scale and the longevity of the operations and business models to evolve on the road map to profitable growth.

It is estimated that over 25000 executives working at India Auto Inc are currently been working from Home to contain the spread of coronavirus contagion.

 


This article does not intend to hurt the sentiments of any individual, community, sect, or religion etcetera. This article is based purely on the author's personal opinion and views in the exercise of the Fundamental Rights guaranteed under Article 19(1)(A) and other related laws being enforced in India for the time being.

Section Editor: Pushpit Singh | 29 Jul 2020 22:21pm IST


Tags : # Automobile # COVID-19

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