Automobile Slowdown
It also said that the sluggish market environment in the first quarter has continued in the beginning of the second quarter as well and its impact is visible in the dispatch volumes.

Amid the massive slowdown in the automobile sector, another company to halt productions is Hero MotorCorp. The company said in a regulatory filing that its manufacturing facilities will be closed from August 15 to 18. The company says that while this was part of its annual holiday calendar, it also partly reflects the prevailing market demand scenario.

“Production planning is a matter of advance monitoring of the market dynamics and prudent demand forecasting. This helps us to plan our production well in advance, thereby enabling us to stay flexible both in terms of volumes and production schedules,” it said, adding that it is in line with this trend that the manufacturing facilities will be closed.

In July, the two-wheeler manufacturer sold 535,810 units of motorcycles and scooters, which is a drop of over 21% from the sales it saw in July 2018 where it sold 6,79,862 units.

It said while disclosing its July sales that the sluggish market environment prevalent in the first quarter has continued in the beginning of the second quarter as well and its impact is visible in the dispatch volumes.

According to the company, the outlook for the rest of the year will be dependent on multiple factors, including the progress of monsoon and festive season offtake, as well as improvement in the liquidity situation.

According to the latest data from Society of Indian Automobile Manufacturers (SIAM), Sales of two-wheelers overall fell by 16.82% to 15,11,692 units in July 2019, while there was a 9.56% drop in two-wheeler production to 20,35,056 units.

Moreover, Hero isnt the first automobile company to suspend operations. Tata Motors went for a 4-day closure from August 16 for the third time this month after it went for a day’s closure on August 1 and a three-block closure from August 8-10.

Mahindra and Mahindra (M&M) too, announced last week that it will be shutting down production for 8-14 days in its various plants during the ongoing July-September quarter.