Indian Auto Industry Hits Rough Road
People Matters|September 2019
The auto industry is having a tough time due to the slowdown in the sector with several companies shutting down their showrooms and handing over pink slips to a large number of employees. The scenario has turned out to be a nightmare for the contract employees as it has already written off more than three lakhs jobs.
Abid Hasan
Indian Auto Industry Hits Rough Road

The auto industry in India is going through a major turmoil as the sector is facing its biggest slowdown in nineteen years. In July 2019, the sale of vehicles across categories in the country slumped 18.71% to about 18.25 lakh units, down from 22.45 lakh units, a year ago in the same month. On the one hand, the numbers of cars are increasing while on the other hand, the numbers of jobs are going for a toss in this sector. This slowdown has created havoc among the people working in this sector because the auto industry in India supports around 3.7 crore direct and indirect jobs and contributes over seven percent to India's GDP and nearly fifty-percent to the country's manufacturing GPD.

According to, Vishnu Mathur, Director General of the Society of Indian Automobile Manufacturers (SIAM), the auto industry has witnessed 3.45 lakh job losses due to the slowdown. Nearly 300 dealership outlets have shut, resulting in 2.3 lakh people losing jobs. The auto component manufacturers are reporting the loss of almost one lakh jobs while original equipment manufacturers have sacked 15,000 workers,"

The Federation of Automobile Dealers Associations (FADA) also mentioned that around two lakh jobs have been cut across automobile dealerships in India in the last three months as vehicle retailers take to reducing manpower to tide over the impact of the sales slump.

FADA added that with no immediate signs of recovery, the job cuts might continue with more showrooms being shut in the near future. The body has direct government intervention such as reduction of GST to provide relief to the auto industry.

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