The situation for the auto sector, which has been suffering due to a slowdown, is likely to improve in the next couple of quarters, said Jitendra Adhia, president – Finance at Atul Auto, adding that the second half of 2019 will be better for the industry.
“At the ground level, the slowdown is going on for the last couple of quarters and impacting on primary dealings as well. We expect that the situation may improve in the next couple of quarters. H2 is expected to be better,” said Adhia, in an interview with CNBC-TV18.
After the Niti Aayog’s plan to phase out three-wheeler IC engines by 2023 and two-wheeler IC engines under 150CC by 2025 evoked sharp reactions from the industry, the government think tank is likely to explore electrification of key cities by 2025 rather than a complete ban, sources told CNBC-TV18.
“The challenges that the government is trying to address are insurmountable. Our only plea is that there will be a sufficient time given. The government has come up with faster adoption and manufacturing of (hybrid &) electric vehicles (FAME)-2 and I think it is a great policy document that talks about localisation. We would have wished if the FAME-II could have been made a bit more aggressive. I wish some thought is given to this and probably a middle path is something should be more appropriate,” Vinnie Mehta, director general of Automotive Component Manufacturers Association (ACMA), said.
When asked if the original equipment manufacturers (OEMs) are prepared for the planned phase-out regarding electric vehicle (EV) products, Mehta further replied, “The component industry is also into a varied state of readiness. The component industry has had many joint ventures (JV), people have come up with newer products, the issue from a component perspective is we work in tandem with the vehicle manufacturers. It is a tandem operation that needs to be put into place. These are challenging times and the industry has been through many ups and downs and I believe we will overcome this challenge as well.”
“We are creating too much uncertainty, which is not good for the country. There are a lot of hopes pinned on to FAME-2 and I hope the government lives up the commitment of funding FAME-2 appropriately,” Mehta added.