Retail auto sales may witness severe losses in April on COVID-19 curbs

Automobile sales are expected to drop big time by a third to half in April compared to the projections for the month, as the surge in Covid-19 cases has put a full stop on sales that were witnessing a remarkable upward trend until two weeks ago.

Automobile dealers have estimated that they would not be able to recover a revenue loss of as much Rs6000 crore, even if the demand returns to normal when the pandemic situation improves.

The lockdown measures immediately after the harvest season would crush the buyer sentiments. It is expected that after the local lockdowns we will see spike in job losses and pay cuts coupled with negative sentiments. Automobile industry will be one of the industries to get impacted.

In Maharashtra, the April sales are expected to be 70% lower than the average as the first 15 days were slow too, Amar Seth, chairman, Maharashtra, Federation of Automobile Dealers Associations (FADA), told ET Auto.

The auto dealership lobby have requested the Chief Minister of Rajasthan Ashok Gehlot to allow car dealerships to open for a few hours with limited staff so that at least the deliveries can take place, Nikunj Sanghi, founder, JS Fourwheel Motors Pvt Ltd, said.

The India automotive industry has already seen difficult past few quarters and this pandemic led lockdown couldn’t have been more ill-timed.Farm sector and two wheelers demand could see a dip but expected to bounce back in the U fashion. Commercial vehicles are expected to show some resilience, although this is contingent on government continuing to invest in large infrastructure projects and the liquidity available with the transportation sector.