Seeks Government Help to control the job loss
M&M said in a statement it was only able to maintain margins due to falling commodity prices and the government must reduce the goods and services tax (GST) rate to spur demand. As per Reuters, that initial estimates suggest automakers, parts manufacturers and dealers have laid off about 350,000 workers since April. M&M shares were 4.9% down in afternoon trading.
"Now job losses are happening in four areas OEMs (original equipment makers), suppliers, dealers and unorganised sector," Managing Director Pawan Goenka told reporters in Mumbai in a post-earnings press meet.
"Given the current challenging global and domestic growth environment, a concerted policy effort will be required to prop sentiment, put a floor under consumption and revive growth," M&M said.
The estimate shows Maruti Suzuki sold a total of 109,264 vehicles, a steep 33.5% lower than the 1.64 lakh units it sold last year. At the same time, there is sharp decline in the sales of Mahindra & Mahindra was 15%. selling just 40,142 units this year. The fall at Honda Cars India was even steeper with the Japanese major managing to sell only 10, 250 cars in July 2019, a whole 48.67% less year-on-year.
The second largest player in the sector Hyundai didn’t have it smooth either. Its sales of 57,310 in July this year was 3.5% lower than the number of vehicles the company sold in July 2018.
This has impacted the two wheelers segment of scooters and motorcycles, the figures for two companies, TVS Motors and Royal Enfield are available and the picture they present is not different from the above for the four-wheelers. While TVS Motors sold 2,79,465 vehicles taking a 13% hit, that of Royal Enfield dropped 22% to 54,185.
There’s no immediate signal from the government that it plans to do anything at its end to improve the situation.
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