Auto industry anticipated to reach pre-pandemic highs by FY2024, says FADA
- The current fiscal is filled with supply chain woes and low demand across auto segments, especially two-wheelers.
Federation of Automobile Dealers Associations (FADA) has anticipated that the auto industry will come out of the woods and reach pre-pandemic highs by FY2024. The current fiscal is filled with supply chain woes and low demand across segments, especially two-wheelers, while a turnaround is expected only in the next financial year, automobile dealers' body FADA said.
The ongoing Russia-Ukraine war and lockdown in China are also expected to hit supplies of critical components thereby impacting the revival of the domestic auto industry. FADA expects the passenger vehicle segment to witness an impact due to the disruption in precious metals and neon gas supplies which originate from the war hit zone.
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Additionally, revival of demand in rural parts of the county would also have an impact on the overall growth of the industry in the current fiscal. "We expect the situation to remain challenging in the current fiscal with sales volumes expected to grow by single digit," FADA President Vinkesh Gulati said.
In the fiscal year ended 2021-22, the total auto industry retail sales grew by 7.21 per cent to 1,63,75,799 units when compared to 1,52,74,314 units in the 2020-21 fiscal. The PV retail sales witnessed a jump of 14.16 per cent at 27,26,047 units, as against 23,87,925 units in 2020-21. However, Gulati said the increase in volumes across sectors in 2021-22 fiscal was on a low base of COVID-hit 2020-21 financial year.
In March, overall automobile retails across categories declined by 2.87 per cent to 16,19,181 units, as against 16,66,996 units in the same month last year.
Overall, FADA remains cautious in terms of any recovery in sight until the Russia-Ukraine war and China lockdown comes to an end. Further, rise in raw material costs have made Original Equipment Manufacturers (OEMs) increase the prices of their vehicles.
(with inputs from PTI)