September 21

Maruti Suzuki chairman RC Bhargava needs action from govt

“There have been a lot of statements made about the importance of the auto industry, but there has been no concrete action in trying to reverse the trend of declining sales.” 

During the 61st SIAM Annual Convention, RC Bhargava, the Chairman of Maruti Suzuki addressed a panel consisting of various delegates from the government and the Indian automotive sector, speaking on the “Outlook of Indian Auto Industry and Its Role in India’s Economic Growth”.

“I’m afraid that words alone don’t get carmakers extra sales; we need concrete action to make this happen.” RC Bhargava touched upon the abolition of auto licensing in 1991, questioning if the mindset about the car industry has changed at all in India. He said, “If the mindset had changed, everybody would have been worried long ago, about the growth of the Indian automotive industry. “He felt that there’s very little done to reverse the trend in the automotive industry, given the sharp decline in sales, especially the commercial vehicle sector that has seen a drastic sales decline.

However, for that to happen, Bhargava said, 

“How do we make cars affordable when we follow European standards to build cars? How can we make cars affordable to those with much lower income levels in India?”

Maruti’s Chairman, added, “I support the move to electrification, but how do we make electric cars affordable? If the auto industry is to drive the economy and the manufacturing sector in India, and if the penetration of cars has to increase, millions of cars need to be manufactured, and millions have to buy them. Do we have millions of customers to buy cars every year? Do we have jobs going up that fast or the income?”

He said, “We often ignore these facts when the automotive industry plans for the future. Customers are always forgotten in the centralised planning system.”

Bhargava about Maruti 800

Bhargava spoke about how the Maruti 800, a car that drove the motorisation of India, was given up for safety regulations. He said how the replacement car that came in, cost an additional ₹45,000. “This may not mean much to me or some of us, but for a person who is buying a car for ₹2 lakhs, it is a lot.” He points out how small increments in cost in cars lead to the fall of the automotive market in India.

“The BS6 regulations added ₹22,000 to the cost of a car and the added taxes have made an entry-level car unaffordable even before the Covid-19 pandemic.”

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