Auto component sector FY21 revenue may fall 14-18% over weak demand: ICRA

ICRA expects recovery of the auto components sector to be gradual and slow-paced, with the industry pinning hopes on revival in rural income to support growth in the festive season and thereafter

Weak demand across domestic original equipment manufacturers, replacement market and exports could lead to a decline of 14-18 per cent in revenues of auto component sector in 2020-21, according to ratings agency ICRA.

It noted that while the auto components industry has been hit due to Covid-19 and lockdown, mission critical replacement parts like batteries and tyres would be less impacted.

"Automobile volumes are expected to decline by (around) 15-16 per cent in FY2021; within this, passenger vehicle demand will decline by 22-25 per cent," ICRA said in a statement.

The year will be tough for commercial vehicles (CV) too, given the slowing