May 14, 2020 (MLN): To say that the auto industry is going through the roughest of phases would be a downright understatement. Before the imposition of lockdown and restriction on business activities, the sector was already suffering due to lower volumetric sales, and if the reports by market analysts are to be believed, the future of the industry is going to be more gruesome than ever if the ongoing situation is not handled on time.
Recently, PAMA released the data for April which showed that not a single passenger car was sold during the month. While there were some units of tractors sold, it is being held that the tractor industry is passing through its worst period in terms of sales and output.
The demand for tractors, especially in the given circumstances, has been continuously declining owing to the COVID-19 pandemic and lockdown restrictions. The reason for the fall in output is the underutilization of production capacity by the current four manufacturers, with most of them operating at less than 50 percent capacity.
The sector sold around 23,506 units in the first nine months of the current fiscal, which is lower than the same period of last year. It is pertinent to mention that the sales made during FY19 amounted to 50,405, while in FY18 the total units sold totaled 70,887 which is also deemed to be the highest annual sales in this decade.
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