Bhargava made a fervent pitch for tax concessions from the central and state governments and said they should recognise the importance of supporting faster growth of the car industry as a means of reviving the economy and creating larger employment opportunities.
"We are looking at localisation not only because of Made in India initiative. Backward integration also insulates from exchange rate fluctuations and makes supply chain shorter," TKM Senior Vice President (Sales and Service) Naveen Soni told.
Industry estimates as many as 197,523 passenger vehicles were sold in the local market last month, which is a tad lower than 200,790 units sold in the same period last year, though significantly higher than 105,617 units sold in June 2020.
The first month post unlock, June, witnessed demand rekindling and retails being very good due to several factors, including pending customer orders as well as pent up demand accumulated as a result of the extended lockdown, he said.
The country's largest carmaker Maruti Suzuki reported total sales of 108,064 units in July 2020. This is a growth of 88.2% over June 2020 and a fall of 1.1% over July 2019. This includes domestic sales of 100,000 units and 1,307 units for other OEMs in the domestic market. In addition, the company exported 6,757 units in July 2020.
The top court was earlier irked over the violation of its order and had pulled up the automobile dealers association by saying that the BS-IV vehicles were sold during the lockdown. The bench had on July 8 recalled the March 27 order by which it had allowed sale of BS-IV vehicles for 10 days across India, except in Delhi-NCR, after lifting of the lockdown.
Sales also went up in West Bengal, Uttarakhand, Tripura, Meghalaya and Arunachal Pradesh. Interestingly, the increase in sales in these states has come at a time when the overall market for passenger vehicles tanked 25% to 1.7 lakh units last month.
The ratings agency said the only limited green shoot visible is the uptick in rural demand, which augurs well for light CVs segment, although ability to recoup lost sales of Q1 FY2021 remains to be seen. Overall, headwinds are expected to exert pressure on earnings and credit profile of CV OEMs.
The scheme also includes an option for first six months EMI to be lower by 76 per cent from regular EMIs for personal UVs, and up to seven years funding for Bolero Pickup and Bolero Maxi Truck, M&M said in a statement.