The recent few months were quite struggling for the Indian automobile industry where it faced a consecutive decline for 10 months in automobile sales. The drop was recorded by nearly 31% for the sales of passenger vehicles in August 2019, which was a huge fall observed in the automobile sector (even claimed to be one of the worst slowdowns in the history of this industry). Amidst this downfall, the recent slight turbulence observed in the sales of the cars in Maruti Suzuki India Ltd has somewhere set high hopes for the Indian automobiles. The statement was given by the chairman of Maruti Suzuki, RC Bhargava on 23 September 2019, Monday in which he spoke about the anticipated elevation in the car sales. Talking about the last month’s stats, the domestic sales fell 34.3% at Maruti Suzuki which whose impact was already seen in the overall industry. But the September has proved to be a major booster for the country’s economy including the recent reduction in corporate tax and the surging Sensex figures witnessed in the middle of the moth. It is worth noting that these economic measures have indeed shown the immediate positive results to uplift the economy; however, their durability, in the long run, is still doubtful.
Having said that, Maruti’s projection for the increased car sales have blown life to the latent auto sector. As per Bhargava, the retail sales in September for Maruti is likely to witness an upturn when compared to that of August. It was also seen that the booking levels for the Maruti Suzuki cars have gone up substantially than that of the previous month which was accused as the ’gloomy month’ that added to the Indian auto sector crisis. However, the September bookings have seen a substantial improvement with which the ending of the month is further expected to see a surge in retail sales. This would add more reflux to the recent announcement made by Maruti Suzuki India (MSI) to launch its mini SUV S-Presso within the end of this month. With the advent of the festive season, the launch is supposed to cater Indian as well as the global market. The increased number of bookings and the forthcoming indigenous product launch by Maruti Suzuki are creating more promises for the auto sector, especially in the crisis phase of the sector.
Is this enough to suppress the recession whispers?
Despite the extraordinary efforts taken by the
Indian Government to improve the country’s economy, it would too quick to jump
to any conclusion. Be it the corporate tax exemption or the measures related to
exports and home buyers; the one after the other announcements of economic
boosters have definitely opened doors for the economic progress. However, the
question mark that is raised on the dawn of recession is still struggling with
the answers. It cannot be claimed yet that these boosters will suffice the
deficit, especially the one caused to the automotive sector. This positive and
mild turbulence has just hit the Maruti Suzuki’s sales, the entire auto sector
is still experiencing a considerate loss. Nonetheless, zero is the first stage
to start with and this is what upkeeping the hopes high for the Indian automobile
sector. In fact, the arrival of the festive season
is expected to add more heat to the Indian markets which may act as another
catalyzer.
