Uncertainty Over GST Bill Affects Truck Sales Temporarily
Published On Aug 05, 2016
Soon after the much awaited Goods and Services Tax (GST) bill got cleared to take the form of a law, many sectors including automobile industry have raised doubts over its implementation and ramifications. While the government is sure that this bill will increase the country’s GDP by two percent, transporters have decided to wait before placing the new orders. Trade analysts believe that in the long run, truck market demand might change to the heavy commercial vehicles and small commercial vehicles for feeder services. This demand change speculation has come after GST has promised to bring greater efficiency at state border checkpoints.
Mr. Vipin Sondhi, MD and CEO, JCB India, said, “The passage of GST in Rajya Sabha is a landmark reform. A critical milestone towards Free Trade within India. It will also give a massive push to Make in India especially MSMEs. The ease and cost of doing business will receive a fillip and the width of the tax base will be enhanced." On the other hand, Bhim Wadhwa, President, All India Motor Transport Congress (AIMTC), the apex body for road transporters, said, “As it is we are seeing a slowdown in demand and now after the GST, buying a new truck is the last thing on a transporter’s mind.”
Talking about the big names, Mr. Ravi Pisharody, Executive Director, Commercial Vehicles, Tata Motors, said, “While it is too early to comment on the actual impact on CV (commercial vehicle) sales, we do welcome the passage of the forward-looking reform, which will augur well in the long term for uniform economic progress across the country.” The Indian trucking industry is already slumping down since the last two months owing to the low freight rentals and declining replacement demand.