India Freezes Its Economy for 3 Weeks
Big hit to the country’s struggling auto industry
Carmakers in India began idling operations earlier this week. Today the government made it official: Virtually the whole country is on mandatory lockdown.
The 21-day order closes almost everything except food stores, medical supply outlets, public utilities, banks, telcoms, police departments and news media.
Carmakers figure the freeze will cost them 750,000 units of production, including $2 billion in lost revenue in March alone, according to the Mumbai-based Economic Times.
The shutdown comes at a terrible time for India’s carmakers.
Producers were already struggling with the government’s jump to significantly tougher emission standards that go into effect on April 1. The move cut production and pressured producers to sell off inventories of cars don’t meet the new regulations.
By then, India was already having a sales problem.
In 2019, the country’s new-car sales plummeted 12% to the worst result in more than 20 years, thanks to a slowing economy, rising inflation and weak currency.
This year, wholesales to dealers fell another 5% in January and 8% last month, according to the Society of Indian Automobile Manufacturers.
India is going into the coronavirus crisis on a weak footing. As we already know from the dynamics of the pandemic in other countries, things are bound to get worse.
India has confirmed fewer than 600 cases of COVID-19 among its visitors and 1.3 billion citizens. But that number has tripled over the past five days, hinting that India will soon join the list of global hotspots for the virus.
A class-action lawsuit has been filed against General Motors Co. over claimed flaws in the company’s 8-speed automatic transmission used in 2015-2019 model rear-drive vehicles.
The little car that could still can. And this time as a car that not only gets great fuel economy, but which has ride and handling that makes it more than an econo-box (and its styling is anything but boxy).
It’s the fifth generation of a vehicle that has been increasing in sales year after year since its introduction in 1997.