New Delhi: Cutting car sales projection for the ongoing fiscal for the second time due to demand slump, SIAM today said the auto industry will miss its target of clocking an annual turnover of $145 billion by 2016 under the Automotive Mission Plan (AMP).
The Society of Indian Automobile Manufacturers (SIAM) lowered car sales growth projection to just 1-3 per cent for this fiscal from the 9-11 per cent announced in July.
Automotive mission plan target
With no signs of a significant growth in the next 3-4 years, SIAM also said the AMP target of annual turnover of $145 billion by 2016 will be missed by around 20-25 per cent at the current rate of growth of the industry.
Considering the low growth that we have seen in the second quarter of this fiscal and the overall macro-economic situation, we feel the car sales will grow around 1-3 per cent this fiscal, SIAM President S. Sandilya told reporters here.
If the car sales grow at this rate, then it will be the slowest since 2008-09, when it grew just 0.18 per cent, he added.
In the second quarter of this fiscal, passenger vehicle sales, including cars, grew just 4 per cent to 6,18,000 units against 5,93,000 units in the year-ago period.
This is the second time SIAM has lowered the growth projection of car sales since it first forecast a growth of 10-12 per cent for 2012-13 in April this year.
Auto industry sales
He said the overall economic situation of the country, low sentiments, high petrol prices and interest rates are among the factors hurting the overall sales of the auto industry.
Even we dont expect to have a good festive season this time around, he added.
Overall, the auto industrys sales will grow 5-7 per cent, much lower than the earlier estimate of 11-13 per cent for this fiscal, Sandilya said.
If this current trend continues, then we will miss the AMP target of achieving an annual turnover of $145 billion from auto and auto-component manufacturers by 2016, he said.
The shortfall will be $34-35 billion and the industry would need to grow at a minimum of 16-18 per cent in the next three to four years to achieve it, he said, adding it is very unlikely that we will grow at that rate and we have missed the bus.
Sandilya said SIAM has already approached the Government to extend the tenure of the AMP by another 10 years in the wake of the development.
We have communicated to the Government that we will miss the targets but we have not given specific targets if the mission plan period is extended to 2026, he said.
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