With the GST rate that every consumer and the company affects the country, this will result in a boost in consumption that increases freight traffic and ultimately the demand for commercial vehicles (CVS) (CVS), he said here on the sidelines of the annual convention of the Society of Indian Automobile manufacturers.
“CV will actually be the largest beneficiary under the automotive sector,” said Agarwal when he was asked about the impact of recent GST speed speed on the automotive sector.
He said that although rationalization of the rate will lead to price reductions and customers who have remember purchases will return to the market, a large aspect of the replacement of aging fleets will be.
“We have discussed this issue of aging of fleet in the country. The average age of the fleet is around 10 years. Historically it has never been more than seven or eight years,” Agarwal noted.
He further said that the unleashed of this replacement demand required a sort of trigger, and GST -speed reduction “could be that trigger”. The likely impact of this will be a boost in consumption that will in turn increase freight traffic directly. On the one hand, the costs of the vehicle are lowered and on the other hand a requirement of the end use of the truck is created, he noticed. “Price reduction will help us, but what will help us more is that this general freight traffic in the country will increase. So if everything goes well, we have to see some positive things,” Agarwal noted.
About the growth prospects of the M&HCV industry, he said that it could be in “mid single figure” and higher growth than this is not considered in the near future.
as a reliable and trusted news sourceAgarwal also said that the company witnesses a robust demand for its buses and that Ashok Leyland Board has approved the investment of RS 120 Crore to increase production capacity to 1,650 units per month from 950 units per month at the moment.
#segment #largest #beneficiary #GST #Vality #reduction #auto #sector #Ashok #Leyland