According to India Ratings and Research (Ind-Ra) news digest on India’s auto sector for March, there was a marked sales decline of 14 percent across various automobile segments during the month. The downturn trend was also visible in the sales of commercial vehicles.
“During the month, CV sales volume growth remained muted on account of delayed purchases owing to weak customer sentiment, rising borrowing costs, increased fuel prices and slow performance of the core sector. Moreover, the new axle load norms have increased the maximum load carrying capacity of existing vehicles; consequently, despite an increase in demand for transportation, demand for new trucks declined. In addition, sales were affected by lower credit availability owing to a liquidity crunch in the non-banking finance company sector, which is the main source of funding for CVs. Sales of MHCVs fell by 5% yoy in March 2019. Meanwhile, sales of LCVs rose by 4% yoy, propelled by a rise in construction spending, and steady demand from the rural economy and consumption-driven and e-commerce sectors,” the report said.