Auto Industry Slowdown: 2 Lakh Jobs Cut in Last 3 Months

In a recent report released by the Federation of Automobile Dealership Associations (FADA), it has been revealed that the ongoing automobile crisis in India has severely impacted around 2 lakh jobs within the last 3 months in order to combat the auto industry slowdown.

The report added that the cutting of manpower may continue as it is expected that there will be more showrooms that will be shut down in the coming months. According to FADA, the Indian government must look into the matter as soon as possible and implement a reduction in the GST rates so that a sigh of relief could be given to the auto industry.

In an interview, the President of FADA, Ashish Harsharaj Kale told PTI, ”The majority of job cuts have happened in the last three months…It started around May and continued through June and July”. Further adding to his statement he said – “Right now most of the cuts which have happened are in front-end sales jobs but if this (slowdown) continues, then even the technical jobs will be affected because if we are selling less then we will also service less, so it is a cycle.”

When enquired about the count of jobs that have been cut down he replied – “Close to about two lakh. It is a guesstimate that our members have already cut 7-8% of the jobs in most of the dealerships as the degrowth has been very high”.

In his statement, he further informed that at present, around 2.5 million people are directly employed in around 26,000 showrooms that are operated by 15,000 dealers, whereas another 2.5 million are indirectly employed in this dealership environment.

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This drastic step to cut down the manpower in the automobile industry was the result of going down of the “margin of error” in the business hence hiking the prices to a great extent happened in the last three to four years.

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