Slowdown in automobile industry attributed to urban congestion

Slowdown in automobile industry attributed to urban congestion

February 24, 2020

A motor company which used to produce nearly 3.10 lakh cars every year now manufactures just 1.30 lakh four-wheelers !

Mysuru/Mysore: There is a slowdown in the economy including in automobile industry as demand for vehicles, especially four-wheelers, has come down due to various reasons including app-based taxis, metro trains and urban congestion, said Shekar Viswanathan, Past Chairman of CII Karnataka and Vice-Chairman, Toyota Kirloskar Motors. 

Delivering the keynote address during the Annual Manufacturing and Technology Conference-2020 on the theme ‘Navigating in the VUCA World — Manufacturing Industry’ organised by Confederation of Indian Industry  (CII), Mysuru chapter at Hotel Country Inn here on Tuesday last, he said “We used to produce nearly 3.10 lakh cars every year but due to demand fallen for four-wheelers we are now manufacturing just 1.30 lakh four-wheelers — that is just 35 percent of total production which we used to manufacture. This is the fate of most of the automobile industry. Especially new generation people are more comfortable hiring cars instead of struggling to find space for parking which has become a stressful thing for them due to which the pleasure of driving car has been lost. Hence most of them have started to make use of air-conditioned metros.”   

He attributed demonetisation also for slowdown of the economy. “Earlier people used to buy vehicles including two-wheeler and four-wheeler by cash payment; the dealers used to have cash counter to count these money but now after demonetisation those cash counters have disappeared as people are not coming with more hard cash. This has made every auto-maker to rethink their plan and strategy,” added Shekar.

 D.K. Lingaraju, Joint Director, District Industries Centre (DIC), delivering a special address said “Manufacturing industry not only plays an important role in improving the GDP of the country, providing job opportunities, improving export quality and quantity but also helps in domestic consumption. The Government, both State and Central, knows the problem of manufacturing industry and hence have come out with various schemes to promote them. Today if one has got all required documents one can get loan or loan approval in just 60 minutes. The Government is addressing skill problem by coming out with Skill Development Department. The industries can approach these Departments and tell the authorities about the required skill for the industries so that the training can be imparted for the aspirants with the help of related institutes.” 

Industries must form clusters 

He called upon the industries to come together and form clusters so that they can get more benefits from the Government instead of fighting individually. “Similar industries, at least more than ten, should come together and form a cluster. There are various facilities and schemes for cluster from both State and Central Governments. Industrialists should also make use of various loans which are available to them,” added Lingaraju. 

 Bhaskar Kalale, Outgoing Chairman of CII briefed about Volatile, Uncertain, Complex and Ambiguous (VUCA ) with respect to the Industry, though it was used for Army fronts. 

V. Eswara Rao, Conference Chair and Convenor, CII Mysuru Manufacturing Panel and VP (Works) Plant I, II, III JK Tyres, also spoke.


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