Auto sales crash to zero as corona bites

Hyderabad: For the first in history, automobile sales in the country have crashed to zero during April as the nationwide lockdown to contain Covid-19 kept all manufacturing plans and showrooms shut. All that some automakers managed to do was exporting handful of vehicles last month. There was sale of few tractors as agricultural activity was exempted from the lockdown.

Market leader Maruti Suzuki said in a statement it shipped 632 units from the Mundra port after resumption of operations there. Mahindra and Mahindra also exported 733 units during the month. As the lockdown has been extended to May 17, there is no let-up in pain for the auto industry.

"Maruti Suzuki India Limited had zero sales in the domestic market, (including sales to OEM), in April 2020. This was because in compliance with the Government orders all production facilities were closed," India's largest carmaker said in a statement.

Mahindra sold 4,716 units Lockdown taking a toll on auto industry as it's losing Rs 2,300 cr revenue daily of tractors in the domestic market last month and another 56 units were exported. Unlike other segments of the industry, the company said prospects for tractor sales on the back of a record rabi season, remain upbeat.

"The extension of the national lockdown impacted the business, with dealers partially open for just a few days. Going forward, several positive factors including a good Rabi output, opening of procurement centres by the government, indication of good crop prices, reservoir levels etc., augur well for tractor demand," said Hemant Sikka, President - Farm Equipment Sector, Mahindra & Mahindra Ltd.

However, the rate of improvement will depend on how quickly the on-ground sales operations, including the start of NBFCs are normalised, following the relaxation of the lockdown, he added.

Each passing day of the lockdown is adding to the woes of the auto sector. According to SIAM, manufacturers are clocking a revenue loss of Rs 2,300 crore every day and the cumulative figure for the month was close to Rs 70,000 crore. Lack of business activity is also burning a hole in the government's pocket.