The last decade hasn't been a cake walk for the Indian auto industry. Along with some major breakthroughs on the technology front and design front, the industry also faced several disruptions, especially in the second half of the decade. Indian automakers did make a leap to cleaner BS6 models along with a substantial upgradation in segments and model line-up over the period and of course the advent of electric vehicles. But then, we can also not forget the GST impact on sales and the prolonged slowdown in the 2017 - 2019 period followed by the COVID-19 impact which turned out to be a nightmare for stakeholders, resulting in recording the minimum growth rate in the FY2015-15 to FY2019-20 period.
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The auto industry has seen several disruptions in the last five years.
According to the Society of Indian Automobile Manufacturers (SIAM), the passenger vehicle (PV) segment recorded a nominal growth of 1.3 per cent in the FY2014-15 to FY2019-20 period, as compared to the previous five years. The growth rate in the FY2009-10 to FY2014-15 was recorded at 5.9 per cent while in the FY2004-05 to FY2009-10 the PV segment recorded a healthy double-digit growth of 12.9 per cent. Having said that, the contraction in growth rate cannot be blamed at the disruptions alone.
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Disruptions in the last five years coupled with a higher base led to this contraction in growth rate.
Yes! The base unit in the last five years was significantly higher as compared to the previous five years of and even higher compared to the FY2004-05 to FY2009-10 period. And the growth when measured to a higher base will obviously reflect lower. So, both factors- disruptions that the industry faced in the last five years coupled with a higher base led to this contraction in growth rate in the FY2014-15 to FY2019-20 period.
