How the second wave of Covid-19 once again disrupted the Indian auto industry
Shortly after the auto industry hinted at signs of recovery as overall sales trended positively in recent months, the second wave of Covid-19 hit the industry hard. Although the pandemic is causing economic disruption and hardship around the world, the damage to India’s automotive ecosystem is also very severe. Dark clouds from the novel coronavirus have forced automakers to suspend operations again, knowing the road to recovery could be even more difficult this time around.
It was only recently that India’s largest two-wheeler, Hero MotoCorp, announced that it had decided to suspend the operations of all of its factories in the country “ in view of the continued escalation of the spread of Covid-19 ”. While Hero added that the action “ will not affect the capacity of the business, ” he also mentioned that aggregate demand itself “ has been affected ” due to localized closures in many Indian states.
Meanwhile, other automakers have delayed or even canceled their product plans which were otherwise set for the first quarter of FY21. Skoda India has postponed the launch of the highly anticipated 2021 Octavia sedan, which was due to go on sale this month. The company cited the growing number of Covid-19 cases across the country and the worsening crisis as the reason for the delay.
Zac Hollis, director of Skoda Auto India, recently took to Twitter to confirm the information. He wrote: “Sometimes it’s important to take a break and come back stronger. At Skoda Auto, we have postponed the launch of the all-new Octavia until the current situation improves. We will keep you posted on the development of the launch. Stay safe and do our part to fight this virus. “
While India’s capital is currently completely locked down, states such as Maharastra and Karnataka have implemented strict restrictions and guidelines to curb the spread of Covid-19. Tata Motors’ Ranjangaon plant is operating at “limited capacity”. The local automaker said in a recent press release, “it is operating its Pune plant in strict accordance with the guidelines mentioned in the Maharashtra government’s ‘Breaking the Chain’ order.”
Toyota Kirloskar Motor has also announced a pause in operations at its Karnataka plant but makes no reference to the restrictions in place in Karnataka to control the increase in Covid-19 cases. Instead, he says the break is to do annual maintenance work, while adding that supplies will be hit. (Read more here)