There had been a modest increase in buying during the festival season and soon thereafter. Since so many manufacturers announced last December that prices would be rising from January 2021, many rushed to make purchases before the price rose. Good crops also contributed to the positive sales graph since more farmers were in a position to buy farm mechanisation and transport vehicles. In the event, December was a good month for the auto sector. However, manufacturers and deals are not confident that this will continue into the New Year. Experts are not optimistic that the auto sector will be able to extricate itself from the slump that it currently finds itself in.
The Indian Federation of Automobile Dealers Associations (FADA) has said that the uptick seen in sales during the last quarter is unlikely to continue during the last quarter of this fiscal year. The auto industry has now pinned its hopes on the upcoming Budget. Government approval for ₹12,000 crore infrastructure projects is one of the much-anticipated announcements that will help to spur demand. A successful vaccine rollout will also help increase sales in the auto sector it is expected.
Auto manufacturers and dealers are hoping for announcements related to electric vehicles, possible changes in scrappage policies in the upcoming budget. As of now, it would seem that a wait and watch approach would be best for those looking to make vehicle purchases – at least until after the Budget announcement on 1st February 2021.
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