According to OLX, India's largest online marketplace for pre-owned cars, sales are projected to grow by at least 10 per cent in 2019 at 4.4 million units even as sales of new cars is expected to decline by 6 per cent this calendar year.
The decline in sales so far is due to weak growth in rural income and moderation in rural infrastructure spending. Rural incomes were impacted towards the second half of last fiscal because crop production was flat after two years of growth at 5-6 per cent.
Finance Minister Nirmala Sitharaman kindled hopes of a GST rate cut on the same day that several leading auto players announced dismal sales figures for August. The auto industry has long called for a reduction in the GST rate from 28 per cent to 18 per cent to accommodate the downturn.
Finance Minister Nirmala Sitharaman had on August 23 announced a few measures including 30 per cent depreciation for new vehicles and revoking the ban on purchasing vehicles for the government, to spur a turnaround but many in the industry felt the measures were too little too late.