‘Automobile industry faces heat as growth rate slows down’https://indianexpress.com/article/cities/chandigarh/automobile-industry-faces-heat-as-growth-rate-slows-down/

‘Automobile industry faces heat as growth rate slows down’

The automobile industry in the country is facing a slowdown due to sharply rising interest rates and frequent hikes in fuel price.

The automobile industry in the country is facing a slowdown due to sharply rising interest rates and frequent hikes in fuel price. On account of the “skewed policies of the government”,this is being seen more in the case of petrol-driven vehicles as compared to diesel-powered ones.

This was stated by representatives of some of the automobile manufacturers of the country at ‘Manufacturing today and tomorrow’ organised by the Confederation of Indian Industry (CII) here in Sector 31.

Speaking on the sidelines of the conference,General Manager (Production) of Maruti Suzuki D S Sarma admitted that the whole economy is looking at a slowdown,and it is a challenging time for the industry. “There is a 20 per cent fall in demand this year as compared to last due to high interest rates and rising fuel price. Growth rate is definitely down and is visible across the country,especially in petrol-driven vehicles. The growth is likely to be stagnant for some time,” he said.

R P Sehgal,Director Works of SML ISUZU Ltd agreed that growth in the automobile sector had slowed down. “From a 15-20 per cent growth in this sector last year,it is down to 10-12 per cent this year,and may fall to 8-10 per cent next year. There is no serious jolt,but the sharp hike in interest rates and fuel prices was bound to impact the industry,” he said.

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Deepak Dalal,Principal – Lead Manufacturing with Accenture,said that on account of these factors,the slowdown was imminent. “Last year auto manufacturers were struggling to meet the demand. Now the demand is not enough,so they are facing issues of excess capacity. The next fiscal is likely to be worse,” he said.

Punjab Chief Secretary S C Agrawal,who was the chief guest at the conference,urged the industry to adopt energy efficient practices to ensure cost competitiveness and higher productivity. Jayant Davar,Chairman of the CII Regional Committee on Manufacturing Competitiveness said India registered approximately 7,000 patents in the previous year,China registered about 140,000 patents,signifying the need for greater research and development in Indian manufacturing. He expressed concern regarding the gap between demand and availability of skilled manpower,which he said is crippling growth in manufacturing sector.

Kamna Raj Aggarwalla,Chairperson,CII Punjab State Council highlighted the significant contribution of SMEs in Punjab,and also the need for encouraging hands-on exposure.