The repercussions of the slowdown in the Indian automobile industry are beginning to be more visible than ever with several major two-wheeler and four-wheeler makers of the country reportedly deciding to opt out of the Auto Expo 2020.
According to a report by CNBC-TV18, automobile companies like TVS Motor Company, Hero MotoCorp, Honda Motorcycle and Scooter India, Honda Cars India, Toyota Kirloskar Motor, BMW and Ashok Leyland will not be participating in the next year’s Auto Expo, which is scheduled to be held from February 7 till February 12 in Greater Noida.
“The domestic two-wheeler industry has been passing through a time of volatility, with market demand still continuing to be sluggish. Notwithstanding these challenges, Hero MotoCorp – and indeed the entire industry – is gearing up for the migration to the new emission norms ahead of the mandatory deadline of April 1, 2020,” the two-wheeler maker said in a regulatory filing on October 12.
“At a time such as this, it is prudent for us to prioritise our resources towards meeting business objectives for the benefit of our customers and other stakeholders,” it added.
The recent data released by SIAM (Society of Indian Automobile Manufacturers) showed that the overall domestic sales fell for the sixth consecutive month of the Financial Year 2019-20 with the numbers plunging 22.41 per cent to 20,04,932 units in September. During the month, the passenger vehicle sales declined 23.69 per cent to 2,23,317 units, while the commercial vehicle sales dipped 39.06 per cent to 58,419 units. There was a drop of 3.92 per cent in the three-wheeler sales to 66,362 units and 22.09 per cent in the two-wheeler sales to 16,56,774 units. Besides, the quadricycle sales jumped 185.71 per cent to 60 units.
The overall domestic sales have declined 23.55 per cent in August, 18.71 per cent in July, 12.34 per cent in June, 8.62 per cent in May and 15.93 per cent in April.
“As the market leader and one of the most vocal torchbearers of the industry, Hero MotoCorp has always been a flagship participant at the Auto Expo in the previous years. However, participation in the Expo would require months of preparation and allocation of massive resources – both in terms of financial spends and manpower,” the two-wheeler maker said.
“In keeping with the prioritised objectives, the company has decided after much deliberation, to skip the upcoming Auto Expo,” Hero MotoCorp added.
The CNBC-TV18 report also added that the Auto Expo 2020 organisers are in discussions with the automobile companies and some of them might decide to participate in the event later.
“Heavy expenses incurred to participate and the lacklustre return of value have primarily discouraged these OEMs to skip the 2020 Auto Show,” IHS Markit Powertrain & Compliance Forecasts Principal Analyst Suraj Ghosh told India Today.
“Auto shows are basically platforms for OEMs to exhibit their breakthrough technologies or new concepts to a market where they plan to establish a new business or expand their existing footprint. But of late India Auto Show has reduced to being a general exhibition for new vehicle launches,” he added.
The automobile companies that will be participating in the Auto Expo 2020 include Maruti Suzuki India, Kia Motors, MG (Morris Garages) Motor India, Hyundai Motor India, Tata Motors, Renault, Skoda Auto, Volkswagen, Mercedes and Suzuki Motorcycle India.