Refuting Finance Minister Nirmala Sitharaman’s claim that the preference of millennials for Ola and Uber was among the reasons responsible for a slump in the automobile sector, a senior Maruti Suzuki India official has said that the Ola and Uber factor may not be strong to contribute to the current state of slowdown.
The cumulative domestic sales for the period April-August 2019 have plunged 15.89 per cent to 97,32,040 units, the latest SIAM (Society of Indian Automobile Manufacturers) data has shown. The domestic sales fell 23.55 per cent in August, 18.71 per in July, 12.34 per cent in June, 8.62 per cent in May and 15.93 per cent in April.
Earlier this month, Maruti Suzuki India had reported a seventh consecutive monthly sales decline with the numbers falling 32.7 per cent to 1,06,413 units in August. Its domestic passenger vehicle sales declined 36.1 per cent to 93,173 units during the month.
Finance Minister Nirmala Sitharaman had said on Tuesday that several factors like the upcoming BS6 emission norms, registration-related matters and a change in the mindset of millennials, who now prefer Ola or Uber rather than committing to monthly instalments to own a car, were responsible for a slowdown in the automobile sector.
“The Ola and Uber factor may not be strong to contribute to the current state of slowdown. I think we need to watch and study it more before arriving at such a conclusion,” PTI quoted Maruti Suzuki India Executive Director (Marketing and Sales) Shashank Srivastava as saying.
“Ola and Uber came into existence during the last 6-7 years. In this period, the auto industry also saw some of its best times. So, what happened only during the last few months that the downturn became so severe? I do not think it is only because of Ola and Uber,” Srivastava said.
Last month, the government had announced several measures to check the downturn in the automobile sector. Now, the BS4 vehicles purchased till March 31, 2020, will remain in operation for the entire period of registration. The implementation of the one-time registration fee has been deferred until June 2020. The vehicles acquired till March 31, 2020, will have 30 per cent depreciation. The ban on the purchase of new vehicles by the various government departments has been removed. Also, the government will consider a scrappage policy.
According to the PTI report, Srivastava also said the government’s measures announced last month to tackle the slowdown are not sufficient and those are helpful for long term health of the industry as they basically addressed the sentiments of the customers.