According to SIAM figures, 2,32,224 passenger vehicles were sold during the month of September.
According to the Society of Indian Automobile Manufacturers, automotive wholesale statistics fell 11% on an annual basis as a worldwide semiconductor scarcity slowed output (SIAM).
“Companies like Maruti, Bajaj, and Royal Enfield have experienced an increasing effect in the September quarter,” Jefferies said, noting that chip shortages are affecting manufacturing and should harm August-September wholesales.
What are Semiconductors
Semiconductors are silicon chips that provide control and memory operations in a variety of electronic devices, including vehicles, computers, and cell phones.
The lack of such a critical component has had a global impact on the automobile sector, as well as other industries, causing them to reduce output.
Where Semiconductors use
In recent years, the use of semiconductors in the automotive industry has increased internationally, with new models featuring an increasing number of electronic technologies like Bluetooth connection, driver-assist, navigation, and hybrid-electric systems.
Impact on the Market
Maruti Suzuki India, the country’s largest manufacturer, reported a 19% drop in overall sales in August, to 130,699 vehicles, down from 162,462 the previous month.
After Bosch, one of the business’s major semiconductor suppliers shut down its facility in Malaysia due to the pandemic, the company reported a 60 percent reduction in output this month.
Veejay Nakra, chief executive officer at Mahindra & Mahindra, said, “While we registered a growth rate of 17 percent in the passenger vehicles segment over the same period last year, the supply of semiconductors continues to be a global issue for the industry and has been a major focus area for us.”
While Tata Motors’ domestic sales were 28,018 units last month, up 51% year on year (YoY) from the same period the previous year, there was a 7% month-on-month decline due to the semiconductor shortage. The concerned person said, “The recent lockdowns in East Asia have worsened the supply situation and hence, Tata Motors is forced to moderate production and offtake volumes in the coming months.”
Impact on Festive season
According to auto dealers, the chip scarcity might cause a 30% reduction in sales during the next festival season. Festival season often accounts for a third of most dealerships’ annual sales.
Now in the end we only hope that this problem ends soon and the market catches its pace again.