India-headquartered TVS Motor is one of those companies seeing lower production levels of its two and three-wheelers, especially since the country imposed a lockdown over three months ago. “Casual workmen and migrant workers hailing from other states may not return rapidly, posing risks across our supply chain,” the company wrote in its recent annual report. It also points to disrupted supplies of spare parts as another factor dragging production down.
The health measures imposed to stem the spread of the coronavirus have crippled many businesses. The automotive sector is no exception. British automotive research company JATO Dynamics notes that global automotive sales plunged 43% y-o-y in April, from the 39% dip registered the month before.
That number is expected to plunge even further in the coming months. “We expect the automotive industry to become an increasingly difficult environment to navigate,” JATO’s automotive analyst Felipe Munoz wrote recently. He also notes that sales in Asian markets like China, Japan and Korea are improving as the pandemic is under control in these territories. However, other territories like South America and India — where Covid-19 continues to rage — are still reeling from a slowdown as lockdown measures continue.
