Shulou(Shulou.com)05/31 Report--

The Automobile Manufacturers Association said here on the 23rd that if sales continue to decline, employees in the automobile industry may bear the brunt because these companies will be forced to reduce their manpower. There are no recruits. SIAM said production of passenger and commercial vehicles was also the lowest in the past 71 months and said it would be close to the center's relief mechanism, including a reduction in goods and services taxes.

Asked if there had been any layoffs in the past 10-11 months, Rajan Wadhera, president of SIAM, said: "I don't think we have reached that stage yet, but we will soon reach that stage. We can't survive now. At SIAM, we support the government's electric car program, but at the same time, we must survive in this transition period. The current technology of the industry should also be protected through this stage."

Growth in the auto industry is likely to be replicated in other industries, he added. The auto industry now employs about 37 million people in need of protection, he added.

Cash-strapped players.

Wadhera said the company has no development plans and is now spending a lot of money (70,000-80,000 rupees) to upgrade its products to meet BS-VI specifications because of a shortage of cash.

He added that dealers have recently seen many outlets (about 300, according to car dealer associations) close, which is not a good sign. He noticed that a large amount of inventory had just begun to be cleaned up.

SIAM said growth in the auto industry was now significantly extended, the biggest since 2008-09 and 2011-12. "however, every market segment did not disappear at that time. Here (in the current case), every market segment. This is an extraordinary long-term growth. There are earlier batches-say a quarter or two-but never like this," Vahla added.

Overall, sales of all categories were very good in the first quarter, according to SIAM data, but this period has not yet happened due to the economic slowdown, low consumer confidence, poor financial situation, declining rural demand, increased insurance costs and other reasons.

Sales in all categories of the domestic market performed poorly in the sixth quarter of fiscal 2010.

Insufficient delivery

Analysts say wholesale transport is likely to remain weak in the next month or two and only some holiday seasons are expected to show signs of recovery.

Ashish Modani, vice president and co-director of ICRA rating, said consumer confidence remained weak, which continued to weigh on demand for non-essential items such as cars. "the government's efforts to recapitalise banks and improve NBFC liquidity are good for the economy, and these benefits will be reflected in the coming quarters," eh added.

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