Mumbai: Eicher Trucks & Buses, a part of Volvo-Eicher Commercial Vehicles, has called for fiscal measures to boost growth in the heavily-taxed auto sector.
The company, which Monday unveiled the country’s first BS-VI-compliant new range of light-duty trucks under its Pro 2000 series, also said it plans to invest Rs 700 crore this fiscal, a part of which will go into adding capacity etc.
The BS-VI-compliant truck launch comes nine months ahead of the new emission norms coming into effect next April.
The auto sector has been reeling since many months and the small and heavy commercial vehicle segment was the worst hit with the volume declining 11.61 percent in May.
The company blamed factors such as the ongoing NBFC crisis, the new axle-load norms, election-induced construction dull as well as slowing growth have for falling volume.
Calling for fiscal measures, it said mere interest rate reduction will not help the sector revive volumes.
“The RBI has cut repo rates. But that is not going to benefit auto players much as NBFCs, which were heavily into funding auto purchases, are not getting funds for many months now. Therefore, fiscal measures such as reduction in taxes are required, as the auto sector is heavily taxed,” said MD, and chief executive at Volvo Eicher Commercial Vehicles, Vinod Aggarwal.
He said a few years back, government had ‘promised’ to reduce corporate tax to 25 per cent and withdrew incentives like additional depreciation, and tax benefits on R&D as part of a roadmap for reforming the corporate tax regime.