India’s automobile sector has been hit by a severe slowdown for many months

Image Source: The Hindu

Sales in the sector have fallen in 12 of the 13 months since July 2018 signalling sharp slowdown

Sales of passenger vehicles to car dealers fell 30.9% to 2,00,790 units in July 2019 over July 2018

The Indian automotive industry was one of the fastest growing industries and an important driver of the manufacturing sector

The current sales of vehicles have been the lowest in the last 19 years, due to a drop in the domestic demand

In 2017–18, the sales of four-wheelers, which were growing at 14% are now down to 5%

For two-wheelers, the decline has been from 15% to 5% over the same period

This data was released by the Society of Indian Automobile Manufacturers (SIAM)

Why is the sector facing a slowdown?

The industry started off 2018-19 on a good note with ups and downs but failed to pick up in August and September...

... after the floods in Kerala and heavy rainfall in several other States

Image Source: Indian Express

After this, others factors affected the sales such as:

Image Source: news18

1. Total cost of vehicle ownership went up largely due to an increase in fuel prices

Image Source: iStock

2. Higher interest rates

3. A hike in vehicle insurance costs

The festive season too failed to boost demand

Image Source: Tour My India

As a result of all these factors, all vehicle categories began experiencing negative growth beginning December

Image Source: ndtv

This has also led to the trimming of over 2.15 lakh jobs in the sector

Image Source: business standard

Other auto stocks such as Maruti Suzuki (33%), Mahindra and Mahindra (46%), Hero MotoCorp (19%) etc have logged substantial losses during the last one year