After guidelines issued by the Ministry of Home Affairs, Government of India on measures to be adopted for containment of COVID-19 epidemic, automotive manufacturers are awaiting a go-ahead from the local administration to resume production. Auto component industry body Automotive Component Manufacturers Association (ACMA) on Wednesday asked the government to urgently provide financial support to the sector and said that with nil revenue due to the lockdown, many of its small- and medium-sized firms are staring at insolvency.
While endorsing the new guidelines issued by the home ministry for the extended lockdown, ACMA President Deepak Jain said the components industry “firmly stands by with the government in this hour of crisis and would abide by its directive”.
Explaining the industry body’s position on resuming operations in the auto component sector, Jain remarked, “Health, safety and welfare of our employees are foremost on our minds. We are also in touch with our customers, the OEMs and resumption of our operations would be aligned to their commencing operations as also on the directions from the local authorities.
It should be noted that the automotive value chain is a highly complex and integrated one. Nil revenues in the auto component industry in the lockdown period have deepened the state of crisis in the industry and several enterprises are staring at insolvency.
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We urge the government for urgently infusing financial stimulus, based on our recommendations, to ensure that the industry has safe and sustainable operations post the lockdown.”
Vehicle manufacturers in India have been going through a stern slowdown for a while now, but challenges for the components manufacturers had begun even before. Manufacturing activities have been shut as per the central government guidelines. The industry was hopeful of getting relaxation starting 20 April but the sector is missing from the list of industries that can resume production which would deepen the impact further.
