Maruti contradicts Sitharaman’s millennial remark, says cabs not a factor in auto slowdown

Finance Minister Nirmala Sitharaman has attributed the auto industry slowdown to millennials preferring use of Ola and Uber cabs over owning cars.

Union Finance minister Nirmala Sitharaman | Photo: Suraj Singh Bisht | ThePrint

New Delhi: Carmaker Maruti Suzuki Thursday said ownership patterns of vehicles have not really changed, contradicting Finance Minister Nirmala Sitharaman’s take on how millennial use of Uber and Ola cabs contributed to the auto sector slowdown.

“Ownership pattern in India still has not changed and people purchase cars with an ‘aspirational aspect’,” Maruti Suzuki India’s executive director Shashank Srivastava said in an interview. 

His statement comes two days after Sitharaman said the slump in the auto sector was also because of a change in mindset of millennials who prefer to use cab services. “Some studies do tell us, the mindset of the millennials who are now preferring not to commit an EMI towards buying automobiles, but would consider taking Ola, Uber and everything else or take the Metro. So, whole lot of factors are influencing the automobiles sector,” she had said.

Sitharaman’s comments led to the hashtag #BoycottMillennials trending on Wednesday, with Twitter folk trolling the remark. 

 

“The Ola and Uber factor may not be strong (enough) to contribute to the current state of slowdown. I think we need to watch and study it more before arriving at such a conclusion,” Srivastava pointed out.

In August, Maruti Suzuki India reported the biggest decline in sales in almost seven years. The drop is in tune with a slowdown in the sector, which is experiencing one of its worst phases in years. In July, the passenger vehicle sales figure dropped by 31 per cent to 200,790 units compared to the 290,931 units in the same period last year. It was the ninth straight drop for monthly passenger vehicle sales.

Big players such as Maruti and Ashok Leyland also shut down manufacturing operations for several days to offset losses.  

Earlier in the day, Union Transport Nitin Gadkari backed Sitharaman on her remark, but underscored that the problem was bigger than millennials using cabs instead of buying a vehicle.

“That is also one of the reasons. Somewhere because of the global economy, business cycle and demand and supply there is a problem. Somewhere the manufacturing was more than the expectation. Now it is a problem,” he told ANI.