What is the industry sentiment for Budget 2016?
Passenger vehicles have shown a positive trajectory with volume growth of 8.5% for the calendar year 2015. This growth was generated on improving fundamentals of GDP growth, reduction of interest rates and controlled fuel prices. The improved customer sentiments propel customer purchase for new vehicles. Challenges were that rural India saw drop in demand with average monsoons and drop in purchasing power.
Industry sentiment is of cautious optimism with many product launches planned for the year as showcased in Auto Expo 2016. Hyundai has led the market with double the industry growth at 15.75% and we are optimistic of our leadership position with sustained growth in volume targets 500,000 by launching two new products this year including a new Compact SUV, Hyundai Tucson and maximizing the Modern Premium expression for customers along with the three Indian Car of the Year brands- Creta, Elite i20 and Grand i10.
Expectations from Union Budget 2016?
· We expect the government will initiate policy measures to further investments which will create employment and sustain the positive GDP growth above 7%.
· Relaxation on indirect taxes to drive in increased conversions through result in a higher disposable income amongst consumers.
· We expect the government to consider Vehicle Scrappage Policy for older vehicles which are low on fuel efficiency and high on emissions.
· A uniform GST policy will provide a uniform tax regime and boost the business environment.
(This article has been authored by Rakesh Srivastava, Sr. Vice President (Sales & Marketing ) at Hyundai Motor India Ltd)