auto update

Auto dealers mulling infra, manpower rationalisation: FADA

Auto dealer body FADA on Thursday said dealers were looking for rationalisation of their assets as well as manpower, especially in bigger cities, to tide over challenging business environment.

FADA said the stress was more on dealerships in bigger cities due to the prevailing situation, compared with outlets in smaller towns and rural areas.

“Dealers are looking at moving to smaller places with relatively low rent and also looking at rationalisation of manpower… to carry forward in these challenges times,” FADA President Vinkesh Gulati told reporters.

To keep the sector alive, FADA is also talking to auto companies to keep inventory in check during the festive season this year in order to avoid overstocking at dealer-end as witnessed in the last two years, he added.

“We are speaking to SIAM and auto companies to keep inventory in check during this festive season as we don’t want to [face the] same situation of overstocking as we did in the last two years,” Mr. Gulati said.

Kia Motors and Toyota Kirloskar Motor had met expectations of dealers better than others in the passenger vehicle segment during the lockdown, FADA said.

In the July-August period, FADA had conducted a survey in association with PremonAsia, on support given by original equipment manufacturers to their dealers for COVID-19. “Even before the pandemic hit us… we were already de-growing for 15-odd months. Against this backdrop, the COVID-19 outbreak has been a significant blow to… auto dealers,” Mr. Gulati said.

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