Beijing – India’s vehicle sales registered an 84% drop in February and a 61% drop in March, said the country’s Automotive Tyre Manufacturers Association.
The pandemic is expected to lessen global vehicle production to 71 million units this year, down 20% from original estimates, said the association’s director general Rajiv Budhraja at China Rubber Conference 2020 streamed online from Beijing on 5 June.
India is the world’s fourth largest passenger vehicle producer and the second fastest growing country in overall vehicle production, trailing only China. The sub-continent’s vehicle production has been growing at a 10% compound annual rate since 2000.
The country’s GDP this year is forecast to shrink by as much as 0.5%. The India government has announced a $280 billion financial stimulus package, or 10% of its GDP.
India’s automotive industry will rebound from fiscal year 2022 (April 2021 – March 2022) onwards, said Budhraja.
India’s tire industry will following the automotive industry with recovery expected in fiscal 2022, he added.
The country’s tire industry turnover arrived at $9 billion (€7.8 billion) in fiscal 2019 and exports amounted to $1.8 billion. Its 62 tire plants under 41 manufacturers are mostly located in the Southern rubber growing regions or along the west coast.
Port congestion and restrictions on interstate mobility has caused hardship in raw materials acquisition, and tapping has not fully resumed due to factors such as unattractive prices and dislocation of migrant tappers. India’s lockdown is likely to result in 50,000 tonnes loss in the country’s natural rubber production this year, said Budhraja.
Today radial tires takes up 98% of India’s passenger car tire production. The percentage for truck and bus tires has reached 51% and will climb to 65% over the next three or four years, said Budhraja.
A few new trends have also emerged, such as tire e-retailing, which is expected to account for 3-4% new tire sales in the passenger car segment by 2025, said Budhraja. Many manufacturers are testing the “CPKM” (cost per kilometre) model as well, where fleet owner subscribe and pay their fees based on kilometres run over a month.