Automobile Industry: Reasons for Slowdown

An engineer working in the automobile industry checks his phone for messages during the break. He got a notification from a news app, which states that there is a continuous declination in the automobile industry for the past 9 consecutive months. He went to his senior officer and asked, “Sir, Did you hear about the crisis happening in the automobile industry?” .The senior officer replied,
“Yep…I heard about that”. The engineer asked, “Sir, Do you know the reasons behind the crisis?”. After a piece of silence, the senior officer says, “The first major reason is high increases in the taxation by our government on cars because they see that as luxury goods. Inflation is not the reason for the price hike. If you see the price increase over the years, it’s not in sync with inflation. Inflation has an increase to that level the price has increased and another reason is that the purchasing power has now been increased at the rate at which inflation has increased. And the next reason responsible is the advent of app-based mailing services such as Uber and Ola. They have disrupted the industry, especially in cities mainly because of the cheap services they offer. Buying a vehicle and maintaining it, costs around 23000 rupees per month. But if we hire a taxi, it costs around only 8000 rupees per month. The next reason is the IT sector slumping right now. It isn’t as good as it used to be before and as a result, there are lots of job losses and pay packages are not as good as it used to be before. So due to this general job security fear. People are avoiding to spend on high ticket items such as cars”. Suddenly the bell rang. The engineer said, “Sir, We have to return to the work. Meet you at the party”. After work, they met at the party. The engineer asked, “So, are these the reasons behind the declination of our industry?” .The senior officer told, “Not only these reasons, but also there
are more reasons behind this”. The engineer asked,” Sir, Can you brief me about those reasons?” The senior officer said, “The other reasons include the pricing of the vehicle, depreciation of the vehicle, congestion, financial literacy, elections, mind-set of youngsters, and finally electric cars.”. The engineer exclaimed, “Electric cars!!!” .The senior manager said. “Yeah… Nowadays people are ready to spend on electric cars.” The engineer asked, “There are so many reasons behind this crisis. So what can we do to overcome that? “. The senior manager smiled and said, “Change is the only thing that will not change. All that changes is living, all that doesn’t change is of this earth. We should update ourselves to the upcoming technologies. We should inform our higher officials about this So that we can withstand in our industry”.