The vehicle industry lost Rs 2,300 crore daily due to the lockdown, nearly 3.45 lakh people lost their jobs
The coronavirus epidemic and the lockdown imposed to overcome it resulted in a loss of Rs 2,300 crore daily to the automobile industry and nearly 3.45 lakh people lost their jobs in the sector. This was said in a report of the parliamentary committee. The report was submitted to Rajya Sabha Chairman Venkaiah Naidu on Tuesday.
The Parliamentary Standing Committee headed by Telangana Rashtra Samithi (TRS) MP Keshav Rao also made several suggestions to attract investment in the vehicle industry, including amendments to the existing Land and Labor Act. According to the committee’s report, various organizations in the automobile industry reported that major original equipment manufacturer (OEM) companies cut production by 18-20 percent due to declining demand and sales. Due to this, 3.45 lakh people are expected to lose their jobs in this sector.
286 vehicle dealers closed
Restoration is stalled in the auto sector. In addition, 286 vehicle dealers have been closed. The component industry has been adversely affected due to reduced production in the auto sector and has also hit micro, small and medium enterprises (MSME) units that make auto parts. The entire sector suffered a loss of around Rs 2,300 crore a day due to reduced production.
Auto sector forecast to decline for 2 consecutive years
According to the report, in view of the crisis, the industry is expected to fall drastically for two consecutive years. This will result in reduced capacity utilization across the value chain of the automotive sector, lower CapEx investment, increased risk of bankruptcy and reduced employment.
