The scarcity of microchips and high fuel prices have dented major automobile manufacturers
The shortage of semiconductors or microchips has had an impact on the level of production in the industry and has increased the waiting time alongside rising prices.
Large automakers such as Maruti Suzuki, Hyundai Motor, Tata Motors and Mahindra reported negative effects on production that resulted in lower deliveries.
Semiconductors play a crucial role in the manufacture of internal combustion engines. They are an integral part of all types of sensors and controls in every vehicle.
Currently, these bottlenecks have forced several original equipment manufacturers (OEMs) to throttle production, further adding to the waiting time for popular, feature-rich, and high-end models.
As a result, the total sales of the passenger car market leader Maruti Suzuki fell from 160,442 units sold in September 2020 to 86,380 units in the reporting month.
“Total sales for the month include domestic sales of 66,415 units, sales to other OEMs of 2,400 units and exports of 17,565 units,” the company said in a statement.
“The company’s sales volume in September 2021 was impacted due to the lack of electronic components. The company has taken all possible steps to limit the negative impact, ”it added.
Hyundai Motor India stated that cumulative sales in September decreased from 59,913 units delivered in September 2020 to 45,791 units.
Domestic sales fell to 33,087 units from 50,313 units in the same period of the previous year.
Similarly, the company shipped 12,704 units in September, out of 9,600 units sold overseas in the same month of 2020.
Even though Tata Motors’ domestic sales rose from 44,410 units sold in September 2020 to 55,988 units last month, Girish Wagh, the company’s executive director, said the semiconductor shortage continues to affect the auto industry worldwide.
“The effects of the delivery bottlenecks due to restrictions in East Asia continued in September and led to a moderation in production and purchase quantities. The situation is fluid and we continue to work to mitigate the impact on our customer orders through an agile, multi-pronged approach, “he said.
Total car sales at other auto giant Mahindra & Mahindra fell 12 percent in September to 13,134 units from 14,857 units sold in the corresponding period in 2020.
Veejay Nakra, Chief Executive Officer (Automotive Division) of M&M, said, “The challenges surrounding semiconductor supply continue to pose difficulties for the automotive industry worldwide. We have taken several steps to mitigate the impact and are working to manage the situation as best we can “as possible.”
Meanwhile, Kia India posted sales of 14,441 units in September 2021. The company became the fourth best-selling automobile manufacturer in India with a market share of 7.8 percent, an increase of 1.4 percent year-on-year.
“The disruption in the supply chain has slowed improving industry sentiment over the past month,” said Hardeep Singh Brar, vice president and head of sales and marketing, Kia India.
“With the holidays approaching, we hope that semiconductor sourcing will improve. For now, we are taking all measures to optimize production and keep the waiting time of our vehicles within limits, ”added Brar.
Rohan Gupta, Vice President of ICRA: “Total domestic PV sales saw a sharp drop in production volume in September 2021 due to the semiconductor shortage, which will further extend the waiting time of car models during the upcoming holidays.
“Dealer inventories are still extremely low, and discounts have been sharply reduced at all OEMs. While the situation is likely to improve sequentially in October 2021, the semiconductor shortage remains acute with a notable respite until the end of 2021 . ”