The Indian automotive industry has urged the government for permission to restart manufacturing operations, as it has recorded zero sales in the domestic market in the first month of FY2021.
According to a report, the industry has been tentatively losing over INR 2,300 crore turnover a day since the nationwide lockdown started on March 24, 2020. So, in the total 55 days of lockdown period, given that it is extended till May 17, the total losses could be accumulated at INR 1,26,500 crore.
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As companies gear up to restart operations, apex industry bodies, Society of Indian Automobile Manufacturers (SIAM), Automotive Component Manufacturers Association of India (ACMA), and the Federation of Automobile Dealers Associations of India (FADA) have jointly written to the government, seeking permission for the entire automotive value chain to re-start operations in unison.
The letter says that the automotive industry is a key driver of India’s economy, accounting for $120 billion (INR 888,120 crore) turnover that contributes 7 percent to India’s GDP and 49 percent to the manufacturing output. The industry also generates employment for over 3.7 crore people, directly and indirectly, and exports $27 billion (INR 199,827 crore) worth of vehicles and components annually.
SIAM, ACMA, and FADA have also mentioned in the letter that the entire industry created detailed safety SOPs (standard operating procedures), and those together with social distancing norms, as prescribed by the government, would be adhered to the utmost sincerity, for any concerns regarding the spread of COVID-19.
The industry hopes that it is treated akin to "essential services" and be allowed to function at par with the steel and cement sectors.
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