Automobile Sector

OVERVIEW IMPACTING FACTORS PRE COVID-19

• Auto industry is interlinked to the • Slowing economic growth rate
economic growth of India. • Transition to BS-VI
• 37 Million people are employed • Higher Insurance rates
directly or indirectly in the sector.
• Saturation levels in certain segments
• Contributes to nearly 22% of
India’s manufacturing GDP,
directly or indirectly.
• Strong presence of established
domestic and international OEMs.
• Strong domestic demand and
exports.
 IMPACT OF COVID-19
NEGATIVES POSITIVES
• Lower GDP and Economic Growth • Decreased trust in public
• Lower vehicle miles travelled transport
(lockdown and work from home) • Exports could increase
• Fewer repairs • Government Stimulus
• Job losses
• Pre-owned cars are in demand
• Moratorium is altering auto finance
dynamics
• Mobility firms like Ola, Zoomcar
may downsize fleet as rides thin out
 Conclusion
• Imminent need for a fiscal stimulus package
• Options for raising capital without increasing fiscal deficit.
Gold Amnesty Scheme
Monetising Assets of the Government
E.g.: Custodian for Enemy Property Act
Strategic Divestments