There are cyclical slowdowns in many economies. 11.7 million vehicles (all categories) were sold during April – September 2019 as against 14.1 million vehicles sold during the same period in previous year. But the festival demand has shown year on year growth at 0.3% in the Passenger Vehicle Segment. Retrenchment of temporary workforce has been reported by the industry. However, no confirmed data on job loss is available with the Government.
The Government, as a policymaker, always attempts to keep and improve momentum of the economy through a package of measure for comprehensive and continued development of the auto sector as and when required. Some of the steps taken by the Government to counter automotive slowdown can be summarized as under:
- Reduction in Corporate Tax to 22%
- Continuation of registration of ICE and EV in future
- Scrappage policy under consideration
- Proposed increase in registration of new cars deferred till June 2020
- Funds worth Rs. 70,000 crores released to PSU banks
- Linking of repo rate to interest charged for vehicle purchased
As per the industry estimates, contribution of passenger vehicles to the Gross Domestic Product (GDP) has varied between 2.1% to 2.9% and the contribution of the Automotive Sector as a whole to GDP has varied between 6.0% to 7.2% from 2010-11 to 2018-19.
This information was given by the Minister of Heavy Industries & Public Enterprises, Prakash Javadekar, in written replies in the Rajya Sabha yesterday.