Indian Auto Industry Battered By Chip Deficit, With Car Sales Falling 41% in September

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Indian Auto Industry Battered By Chip Deficit With Car Sales Falling 41 percent in September

According to the Society of Indian Automobile Manufacturers (SIAM), automotive sales in India fell by 41% in September compared to the same month in 2020. While car sales dropped to 160,070 units last month, motorbike and scooter sales dropped to 1.5 million units from 1.8 million in September 2020.

Reason behind falling car sale

  • The most important reason for the fall is the global scarcity of semiconductor chips, which has affected OEMs all around the world, including those in India.
  • Semiconductor chips are the brains of today’s cars, but they’re also widely utilised in consumer electronics like phones and laptops. A surge in demand for such products as the globe rises from the shadows of the Covid-19 epidemic has exacerbated the supply challenge for automakers. Some of the country’s greatest stars are feeling the heat in India.

With spending cuts that began in September and are expected to continue throughout October, the road ahead is likely to remain bumpy.

Statistical analysis showing fall in automotive sales

  • Last month, passenger car sales were 1,60,070 units, down from 2,72,027 units the year before.
  • According to the latest statistics from the Society of Indian Automobile Manufacturers (SIAM), two-wheeler dispatches to dealers fell by 17% to 15,28,472 units in September 2020, compared to 18,49,546 in September 2019.
  • Last month, motorcycle dispatches fell 2% to 9,48,161 units, down from 12,24,117 the previous month.
  • Scooter sales fell 7% to 5,17,239 units, down from 5,56,205 units a year earlier.
  • Last month, total vehicle sales fell 20% year over year to 17,17,728 units from 21,40,549 units the previous month.

Conclusion

Almost every automobile business in India and worldwide has the same difficulties. The timing, on the other hand, could not have been worse in India, where demand often spikes over the festival season. However, with longer manufacturing cycles, it’s possible that orders could be cancelled or at the very least, purchasing intentions would be postponed until next year.

As industrial production cycles are modified and a cautious approach is emphasised as the best way forward, the road ahead remains strewn with obstacles.

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