Auto sales may dip by up to 25% in FY21, sharpest decline in two decades: Report

The automobile sales may decline by up to 25 per cent in this financial year as compared to 2019-20 due to a complete washout in April and minuscule sales last month, according to rating agency Ind-Ra.

Monthly sales volume may not return to the pre-Covid levels before mid-2021-22, Ind-Ra said. (Representational photo) (PTI)
Monthly sales volume may not return to the pre-Covid levels before mid-2021-22, Ind-Ra said. (Representational photo)

The decline (excluding in tractors) would be the steepest in the last two decades, much higher than that recorded during the global recession in 2008-09, and is likely to push industry volumes to the 2011-12 levels, Ind-Ra said in a statement.

The two-wheeler segment is expected to rebound faster, followed by passenger vehicles (PVs), while the decline in medium and heavy commercial vehicles (MHCV) is likely to be the steepest during 2020-21, it added.

Also check these Vehicles

Find more Cars
Emflux Motors Emflux Two (HT Auto photo)
₹ 4 - 4.50 Lakhs* *Expected Price
View Details
Hero Splendor Plus (HT Auto photo)
₹ 75,141 - 76,486**Ex-showroom price
Add to compare
Check latest offers
Yamaha Mt-15 (HT Auto photo)
₹ 1.69 - 1.74 Lakhs* *Ex-showroom price
Add to compare
Check latest offers
Royal Enfield Classic 350 (HT Auto photo)
₹ 1.93 - 2.25 Lakhs* *Ex-showroom price
Add to compare
Check latest offers
Royal Enfield Hunter 350 (HT Auto photo)
₹ 1.50 - 1.75 Lakhs* *Ex-showroom price
Add to compare
Check latest offers
Honda Activa 6g (HT Auto photo)
₹ 76,234 - 82,734**Ex-showroom price
Add to compare
Check latest offers

Also Read : India's automakers warn of up to 45% sales drop as economy slumps amid pandemic

The rating agency expects two-wheeler sales to decline by 20-22 per cent, PV by 22-26 per cent, light commercial vehicle (LCV) by 26-30 per cent and MHCV by 35-45 per cent year-on-year in 2020-21.

Also, monthly sales volume may not return to the pre-Covid levels before mid-2021-22, Ind-Ra said.

"Volumes could increase by a high-single to a low double-digit rate in FY22, on account of a pent-up demand; however, it is subject to an improvement in industrial production activities, favourable regulatory changes, increase in consumption levels and a macro economic recovery," it added.

Also Read : Indian auto industry faces another year of double-digit sales decline: CRISIL

Ind-Ra noted that the rural sector is likely to drive sales growth in two-wheeler and tractor segments.

The strong rabi crop harvest in 2019-20, an expectation of normal monsoon this year and a good kharif harvest forecast, coupled with government incentives and less exposure to lockdown related economic hardships, will boost rural income, it noted.

Also Read : China's monthly car sales rise by about 2% for the first time since June 2019

"Hence, the decline in tractor sales volume is likely to be limited at 10-12 per cent year- on-year in 2020-21," Ind-Ra said.

Exports could come under pressure whileoverall industry revenue is expected to decline by 17-20 per cent year-on-year in the current fiscal, it said.

First Published Date: 09 Jun 2020, 17:55 PM IST
Shopping Bag Shop Now
74% OFF
Microfiber Car Cleaning Soft Brush Ideal as Mop Duster, Washing Brush with Long Handle, Dust Cleaner Car Wash Brush with Handle, Soft Brush Scratch Free, Cleaning Dashboard Curved Design - Grey
Rs. 389 Rs. 1,499
1% OFF
GOODAIR Clear Car Windshield Enhancer | Classic |12 Tablets
Rs. 295 Rs. 299
51% OFF
AGARO Galaxy Cordless Tyre Inflator, Portable Air Compressor, Flash Light, Power Bank, Multipurpose Use, Rechargeable, Up to 150 PSI Air Pump for Car, Bike, Foot Balls, Inflatables, Black & Red
Rs. 2,199 Rs. 4,499
55% OFF
Antson Portable High Power 2 in 1 Car Vacuum Cleaner | USB Rechargeable Wireless Handheld Car Vacuum Cleaner Traveling, Camping Reusable and Sustainable, Portable,Rechargeable Vacuum (2 in 1)
Rs. 899 Rs. 1,999

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city
Powered by: Acko Logo
Please be noted that any information provided herein above will be received by Acko General Insurance Limited (“Acko”). By mentioning the above information, you agree to provide these details and information to Acko.
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.