MRF, India’s leading tyre manufacturing giant, has recently said that the current year may be difficult for the Indian automotive industry as the country makes a transition from BS-4 to BS-6 norms.
MRF Chairman & MD, K. M. Mammen Mappillai, stated that the uncertainty can be further aggravated by a lower consumer demand which could result in inventory build-up and almost all Original Equipment Manufacturers (OEMs) aligning production with demand. He further added that India continues to be among the most preferred economies in the world, in terms of growth and investment. However, the previously mentioned short-term problem will have to be factored in by the tyre manufacturers to ride the tide.
Mr. K. M. Mammen also said that considerable grants have been made in the infrastructure sector in the latest union budget, which should aid the growth of road transport sector. He also welcomed Modi Government’s decision to offer incentives to the electric vehicle (EV) segment which is a sunrise industry and is expected to have a long-term positive impact on the environment.
According to Mammen, the automotive industry would face challenges due to the shortage of credit funds in the days ahead. However, the shortage has been moderately resolved in the Union Budget 2019.