Marred with the COVID-19 pandemic, 2020 was not a great year for the manufacturing industries including car manufacturers. With the rising number of COVID-19 cases and lockdowns happenings in the localities, India’s largest manufacturer – Maruti Suzuki India’s chairman RC Bhargava voiced his concerns.
In an interview with Economic Times, Bhargava said that he is not convinced with the curfews and the kind of lockdowns the Maharashtra government has done to deal with the COVID situation. Bhargava also said that actions that stop legitimate economic activities are necessary to curtail the pandemic. Steps like lockdown and curfew are an overreaction trying to deal with the problem. The curfew and lockdowns will hurt people. While he says that these steps can temporarily bring down the spread of the pandemic, he does not think that it is the right solution.
Bhargava also says that if more states and union territories impose lockdowns like Delhi and Maharashtra, the supply chain can get disrupted and the production can come to a halt. When the production stops, it affects employment, incomes economic activities, tax and revenues. These things happen only when some people fail to follow the protocols.
Lockdowns that shut down the sales outlet also affect the production as there is no demand in the market. Bhargava has urged policymakers to understand the consequences the lockdown will put on the economy.
Bhargava also said that he agrees with Rajiv Bajaj to the fact that the government will not be able to change much in 14 days when they had the time of 14 months too change the situation. He is also hoping that the Haryana government will not impose a lockdown in the state and they will not follow what Maharashtra and the Delhi government has done.
Maruti Suzuki made ventilators
During the peak of the pandemic in 2020, the government of India urged car manufacturers to produce ventilators. Bhargava says that Maruti Suzuki produced the required number of ventilators according to the order and they were equipped to produce more. However, currently there is not a high demand for the ventilators in the market and there are many who have ventilators prepared to ship off in the market. However, there is no demand at the moment.
Showing the bright side, Bhargava says that both enquiries and orders are not down yet. However, if the lockdown continues and more states join the bandwagon, the demand will definately go down in the future.
Current demand in the market
The Indian automobile market has recovered after months of no sales. Almost all the manufacturers limped back to the production. Currently, almost all the manufacturers are back to the pre-COVID lockdown numbers and some of them have even exceeded those sales figures. However, in the last fortnight, India has seen the worse figures in COVID-19 cases and that is likely to impact businesses in the future.