Car dealers may go bankrupt Mahindra MD opined. Pawan Goenka Mahindra and Mahindra (M&M) managing director said that currently with poor auto sales leading to thousands of job losses across the M&M. The next big fear is of suppliers and dealers going bankrupt if the upcoming festive season turns out to be thinner in terms of demand.
“If we miss this festive season and don’t see a turnaround, there will be a significant negative effect in terms of jobs, investments, and bankruptcy. Many suppliers may have to declare bankruptcy Goenka said, adding there have already been 12 months of the slowdown in car sales which is very long.
He made these comments after the closing of over 300 dealerships in the last year that led to the loss of around 2 lakh jobs, according to Federation of Automobile Dealers Association. As per the Society of Indian Automobile Association, approximately 15,000 people have lost jobs in the sector in the last 3 months.
Goenka also admitted that the current government has little space for a GST cut on automobiles which have been a long-standing demand of the automobile industry, he said the central government can take several measures on the non-revenue side. On the non-revenue impact side, Goenka suggested bringing back the third-party insurance requirement to one year and elimination of 1% TDS is very useful to revive the automobile industry.
Car Dealers Go Bankrupt