Introduction of electric vehicles: To get their emissions levels down, carmakers would have to sell a

lot more electric vehicles, but there are big obstacles in the way. Relevant infrastructure is required
to produce these vehicles and due to the lack of subsidies by the government for the setup has
resulted in a huge burden over the manufacturers and there is an extent to which the original
equipment manufacturers can realize and understand the e-mobility concepts. The customers are
also anxious with respect to the travel range capability and the high cost of these vehicles which has
led to manufacturers not actively marketing the ev.

Slow Economic growth: From the last quarter of 2018, the sales of automobiles has started
decreasing and we have observed the steepest fall in the last 19 years during august, 2019. The
prolonged demand slowdown has triggered production as well as job cuts in the sector.

BS-VI Transition: the BS4 to BS6 transition has led to more stricter and environment-friendly vehicle
emission norms to come into effect which requires the upgradation of the technology to keep the
emissions in check. The prices of the diesel cars has also increased to incorporate this new
technology to reduce their overall emissions. The car manufacturers also has to increase their
investment to upgrade the existing vehicles and make them BS-VI compatible.

Liquidity Crunch: Nowadays, it has become very harder to get loans from the banks as they have
become more strict about giving out loans and favours only those individuals which have high CIBIL
scores. Since people with lower CIBIL scores are not able to get loans as easily, they are not able to
purchase high value assets, such as cars.

Potential Bankruptcies: Due to the Covid-19 lockdown, many businesses are fighting to survive.
These are challenging times for the Indian automotive sector on account of slow economic growth,
potential bankruptcies, and low capacity utilization. The lockdown has had a multiplier effect on an
already stagnant industry, affected manufacturers’ revenues and cash flows. In response to the
crisis, most of the companies have starved their R&D funding to sustain their core operations and
thereby altering the progress made on alternate fuel and mobility technologies. And eventually,
many companies have chosen to take a strategic call to exit vehicle segments and unprofitable
markets.

Now the recommendations will be discussed by my colleague Ankit