Two wheelers and three wheelers, were expected to decline by 6-7 pc this fiscal as compared with 2018-19 to around 25 million units.
August domestic sales at Maruti Suzuki fell 34.3 per cent, one of the biggest monthly drops in sales in recent times.
Total annual revenue loss could be as much as 500 bn rupees if the panel decided to lower tax rates for auto sector to 18 pc from 28 pc.
Sales of commercial vehicles and two wheelers have narrowed down to 7.4 per cent and 0.3 per cent month-on-month.
Due to increased prices of auto parts, taxes and rise in insurance rates are some of the reasons for slow down in automobile industry.
Automobile and components industry has been affected by BS6 and the mindsets of millennial, who now prefer to have Ola and Uber.
Sales of commercial vehicles were down 38.71 per cent to 51,897 units in August.
According to industry estimates, automakers, component manufacturers and dealers have laid off about 350,000 workers.
Initial stimulus package is not enough to stop the decline in the automotive market, Fitch said.
Production volume of OEMs is estimated to either degrow or log low single digit growth at best in the next two years.