Domestic passenger vehicle sales skidded for the 10th consecutive month, falling from 287,198 units in August last year to 196,524 units last month and registering a 31.57% decline.
Domestic car sales were down 41.09% to 115,957 units compared to 196,847 units in August 2018, according to data released by the Society of Indian Automobile Manufacturers (SIAM) on Monday.
Motorcycle sales last month declined 22.33% to 937,486 units as against 1,207,005 units a year earlier. Total two-wheeler sales in August declined 22.24% to 1,514,196 units compared to 1,947,304 units in the year-ago month.
Sales of commercial vehicles were down 38.71% to 51,897 units in August, SIAM said. Vehicle sales across categories registered a decline of 23.55% to 1,821,490 units from 2,382,436 units in August 2018, it added.
Medium and heavy commercial vehicles sales were down 54.3% at 15,573 units year-on-year while light commercial vehicles sales down 28.2% at 36,324 units in the year-ago period.
The automobile industry in India is undergoing a crippling slump with nearly all manufacturers report a slowdown in sales and job losses due to subdued consumer sentiment amid an economic slowdown.
The slowdown in auto sales also stems from a severe liquidity crunch in the non-banking financial sector which has dried up lines of credit to both auto dealers and potential car buyers.
The auto industry accounts for nearly half of India’s manufacturing output and employs over 3.5 crore people directly and indirectly. Representatives of major automobile manufacturers have urged Finance Minister Nirmala Sitharaman to lower the Goods and Services Tax (GST) from 28% to 18%.
On August 23, Sitharaman announced that government departments will be allowed to buy new vehicles, automobiles purchased till March 31 next year can avail the benefit of additional depreciation of 15% with total depreciation up to 30%, and BS-IV vehicles bought till March 31 next year will remain operational for their entire registration period.
However, she has said that the GST Council will take a call on the possibility of lowering the GST.
Maruti Suzuki recently observed two days as ‘no production days’ in view of inventory pile-up. On Monday, Ashok Leyland announced a series of non-working days.
(With ANI inputs)