Credit rating agency Crisil forecasts that the automotive component industry will likely record 5-7% compound annual growth rate (CAGR) over FY2020 and FY2021, down from 12% in the preceding two fiscals, on the back of the ongoing slump in the demand for vehicles. Crisil said the production volume of the original equipment manufacturers (OEMs), meanwhile, is estimated to “either register a year-on-year decline or log low single-digit at best in the next two years”. According to the data released by Society of Indian Automobile Manufacturers (Siam), July 2019 recorded 31% YoY decline in passenger vehicle wholesales, worst in the last two decades. Commercial vehicle (CV) and two-wheeler wholesales too registered sharp fall of 26% YoY and 17% YoY respectively. Cumulative wholesales during April–July period for all the vehicle categories put together is down 14% YoY. New vehicle demand is also expected to be impacted by the transition to BS-VI emission norms from 1 April 2020, which will drive up the vehicle prices across segments.

(Live Mint)