New Delhi [India], April 18 (ANI): The President of the Federation of Automobile Dealers Associations (FADA) expressed concerns regarding the country's automotive sector if the war is prolonged.

Speaking to ANI at the sidelines of the Vyapar Delhi event, FADA President C.S. Vigneshwar stated that the ongoing conflict in West Asia will specifically affect export volumes and the supply of essential commodities like oil and aluminium.

He noted that while the domestic market remains resilient following a period of high growth, prolonged geopolitical tensions could create challenges for production and international trade.

'The unfortunate incidents which are happening in the Middle East will definitely have an impact on the automotive sector. For example, oil. A lot of our cars need oil, they need lube, and they also need petrol and diesel to run. So these would be impacted, of course, if the conflict prolongs, but the government is doing everything possible to lessen the impact. But from the production side, we also have issues of availability of gas, and also aluminium is becoming a little bit of a challenge. I'm sure the government is doing everything possible to address it, but these are challenges which we need to face in the coming months if the conflict there is prolonged,' Vigneshwar said.

Addressing the potential divergence between domestic and overseas sales, the FADA President indicated that a slowdown in exports is a primary concern for the industry. He highlighted that the domestic market previously recorded a 13 per cent growth rate across all sectors, providing a strong cushion against global volatility.

'I, perhaps, think there would be a drop in these vehicles being exported out of India. The domestic market is strong. We had a breakneck growth last year. It grew at about 13%. Every sector grew. I'm sure the sector would still perform strongly. You, of course, will have a hiccup here and there. It's a major hiccup in the Middle East conflict. But I'm sure it'll start to sell well. We need to move on,' he added.

Vigneshwar emphasized the need for the industry to manage supply chain disruptions caused by regional blockades and the continued dependence on imported resources like lithium. He noted that there needs to be a balance as the country is dependent on oil as well as lithium.

For the FADA President, not only must the fuel economy go up, but the country also needs to find alternative sources from which it can get this lithium. 'I think recently even the Indian government has found lithium reserves, and we need to mine it and manufacture it into batteries as fast as possible,' he said.

Vigneshwar also touched upon the Electric Vehicle (EV) policy and the necessity of building a supportive ecosystem for cleaner fuels. He noted that EV penetration is steadily rising, with two-wheelers (2W) reaching a 9 per cent share and passenger vehicles (PV) touching 5.75 per cent in the last month.

'We can never be ready for tomorrow unless we know what tomorrow wants, tomorrow entails. So we are right now getting to understand what tomorrow is...The EVs right now in terms of two-wheelers, last year we ended at about 7%, but last month we are at about 9%. In terms of commercial vehicles, we are at about 2% penetration. When you also look at passenger vehicles, which is the supermodel of whatever is required, we are at about close to about four and a half, five per cent. But this is increasing,' Vigneshwar remarked.

Vyapar Delhi served as a platform for dealers, Original Equipment Manufacturers (OEMs), and policymakers to deliberate on industry challenges. The event included participation from the Chief Minister of Delhi alongside representatives from insurance and finance companies to address dealer concerns and help frame future policies. (ANI)