Automobile sector conytribtes to 40% to India's manufacturing GDP, ays Union Minister Nitin Gadkari
MUMBAI, Sep 14 (The CONNECT – The government’s vehicle scrap policy is bound prove to be boon for the automobile industry which can now save on cost of production by over 25%.
Union Minister of the Ministry of Road Transport & Highways Nitin Gadkari said the initiatives in recycling materials such as aluminium, copper, steel, rubber, and plastic components are poised to reduce automobile component prices by a significant margin of 25-30%.
To strengthen our industry's competitiveness, the government has set up scrapping centres, he said inaugurating the fifth edition of the Auto Retail Conclave organised by Federation of Automobile Dealers Associations (FADA).
The scrappage policy promises to have a profound impact on our manufacturing costs, making us more globally competitive, Gadkari said and asked automobile dealers to take the initiative of setting up scrapping centres, fitness centres, and driving training centres. “This proactive step not only rejuvenates businesses but also aligns with our broader mission of promoting green mobility. Also, the government is committed to providing all necessary support for these initiatives,” he temarked.
FADA president Manish Raj Singhania said the 2Wheeler industry is an important part of the mobility ecosystem, and hence urge the government to reduce the GST rate from 28% to 18% for entry-level vehicles in the 100-125 cc range. This change isn't just a policy adjustment; it's a catalyst for socio-economic progress, he observed.
Auto retail encompasses more than the sale of vehicles; it encompasses road safety, employment, and sustainability. The Indian Auto Retail isn't merely recovering; it's thriving! In the last fiscal year, we witnessed a resurgence, achieving a record-breaking 21% growth rate with 22.1 million vehicles leaving our showrooms. Two-wheelers surged by 19%, three-wheelers by a staggering 84%, passenger vehicles by 23%, and commercial vehicles by an incredible 33%. Despite this remarkable progress, the 2-wheeler segment remains 20% below pre-Covid levels. In the last five months Auto sales have grown by 7%.