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Chip shortage affects domestic automobile sales in August

Chip shortage affects domestic automobile sales in August


Chip shortage affects domestic automobile sales in August

Automobile wholesales in India declined 11 per cent year-on-year in August, as the semiconductor shortage hit production processes across the industry, SIAM said on Friday. The total wholesales across categories, excluding commercial vehicles, declined to 15,86,873 units last month, compared to 17,90,115 units in August 2020.

According to the latest data by the Society of Indian Automobile Manufacturers (SIAM), two-wheeler dispatches from OEMs to dealers declined last month while passenger vehicle and three-wheeler wholesales witnessed an increase over August 2020. Two-wheeler dispatches from the OEMs to dealerships declined by 15 per cent to 13,31,436 units in August, compared to 15,59,665 units in the year-ago period.

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Motorcycle sales were at 8,25,849 units last month as against 10,32,476 units in August 2020, down 20 per cent. Similarly, scooter dispatches declined 1 per cent to 4,51,967 units last month from 4,56,848 units a year ago. The total passenger vehicle sales — including dispatches of cars, utility vehicles and vans — from OEMs to dealerships increased by 7 per cent to 2,32,224 units in August compared to 2,15,916 units in the same month last year.
hree-wheeler wholesales increased 60 per cent to 23,210 units last month as against 14,534 units a year ago.

Commenting on the August sales, SIAM Director General Rajesh Menon said the Indian automobile industry is reeling under pressure due to supply chain challenges. “The global semiconductor shortage continues and now it is having an acute impact on output across the auto industry,” he added. The usage of semiconductors in the auto industry has gone up globally in recent times, with technological advancements and new models coming with more and more electronic features such as Bluetooth connectivity and driver-assist, navigation and hybrid-electric systems, besides the engine control unit.

However, the auto industry accounts for about 10 per cent of the overall semiconductor demand, with the rest coming from the electronic appliances and gadget industry, such as mobile phones and laptops, among others. Menon noted that in addition to the chip shortage, high commodity prices remained a challenge, as it was impacting the cost structures of the auto industry. “Against such strong headwinds, SIAM members are working hard to meet customers’ demand and expectations, while ensuring the safety of its people across the value chain,” he added.

Looking at the cumulative sales from April to August 2021, the passenger vehicle segment is still below the level of 2016-17, the two-wheeler segment is lower than the level of 2011-12, and the three-wheeler segment is behind by many years, Menon noted. In the passenger vehicle segment, the country’s largest carmaker Maruti Suzuki India (MSI) dispatched 1,03,187 units last month, down 9 per cent from 1,13,033 units in August 2020. On the other hand, Hyundai Motor India sold 46,866 units last month, compared to 45,809 units in August 2020.

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  1. Pingback: Govt enhances scope of MTA scheme for agri exports

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