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Last Updated : Aug 14, 2019 10:49 PM IST | Source: CNBC-TV18

Auto sector crisis: GST cut for a short period will kick start industry, says SIAM

Vishnu Mathur, the director general of SIAM, said, “Passenger car sales are down this time by almost 36 percent and passenger vehicles overall is down by almost 31 percent."

CNBC TV18 @moneycontrolcom

The country's domestic passenger vehicle sales fell for the ninth straight month in July, the auto industry body Society of Indian Automobile Manufacturers (SIAM) said on Tuesday.

Vishnu Mathur, the director general of SIAM, spoke to CNBC-TV18 about the slowdown in the auto sector.

“Passenger car sales are down this time by almost 36 percent and passenger vehicles overall is down by almost 31 percent,” said Mathur.

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“We have seen a higher downturn in any single month in December 2000, almost 19 years back and that also goes for the overall numbers; the overall downturn this time is minus 19 percent,” he added.

Talking about the job losses, Mathur said, “There have been no job losses in the permanent workforce and I do not think easy to lay off people from the permanent workforce.”

“The job losses have happened largely in the temporary and casual category, the contract labour whereas in the OEM segment, with whatever data we have collected from some companies so far, there is a number of about 15,000 people who have already been laid off,” Mathur added.

Talking further about the job cuts, he said, “In the auto component sector we hear about 1 lakh people being laid off already and almost 1 million is at risk. In dealers’ community, there have been dealerships that have closed down and from the dealers’ industry, we understand, almost 230,000 people have lost their jobs.”

Speaking about meeting with FM, Mathur said, “We had a good meeting last week with the finance minister and her team. It was a very positive meeting. We tried to explain the state of the industry and what we feel could be the possible measures that they could take to revive the industry.”

According to him, cut in excise duty in the last two downturns have given a big boost.

On the GST front, he said, “Even if it is for a short period of time, just to kick start the industry, there should be a reduction in goods and services tax (GST) from 28 percent to 18 percent.”

Source: CNBC-TV 18

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First Published on Aug 14, 2019 07:20 pm
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