The Indian automotive industry,it appears, is likely to face a demand-supply imbalance. The long-standing semi-conductor or chip shortage is hampering production schedules and companies are bracing for tough times ahead. From July to August, many original equipment manufacturers (OEMs) have reported a decline in sales on a sequential basis in the passenger vehicle (PV) segment.For two-wheelers, the recovery has been slow but industry players are hopeful of the upcoming festive season. Commercial vehicle (CV) sales have also grown on a low base of last year, while the tractor segment remains positive owing to the harvesting season coinciding with the festive season.
Snapshot of sales figures:
Maruti Suzuki sales fall 19.5% m-o-m: Total sales of Maruti Suzuki India (MSIL) fell in August due to the semi-conductor shortage. Sales fell 19.5% m-on-m to 1,30,699 units in August, the company said in a statement.
Sales snapshot (m-o-m)
- Exports fell 2.8 % to 20,619 units.
- Mini and compact vehicle segment sales fell 26.5% to 89,953 units.
- Utility vehicle sales too fell 24.5% to 32,272 units.
Tata Motors’ car sales fall 7.17% m-o-m: Tata Motors Ltd’s passenger vehicles division sold 28,018 units in August, a 7.17% fall over the preceding month as lockdown in East Asia worsened the supply situation. The company, in a statement, added that the ongoing chip shortage has forced the company to moderate production and offtake volumes in the coming months. Tata Motors said the situation is fluid and the firm continues to mitigate the impact of the chip shortage.
M&M auto, tractor sales decline m-o-m: Mahindra and Mahindra Ltd’s (M&M’s) auto segment posted an overall sale of 30,585 units in August, a fall of 29% over July. M&M’s passenger car sales too fell 24% over July to 15,973 units in August. “Supply of semi-conductors continues to be a global issue for the auto industry and has been a major area of focus for us,” Veejay Nakra, CEO of Automotive Division at M&M, said. The farm equipment segment too saw a drop as tractor sales fell 21.5% over July to 21,360 units.“With the festive period on the anvil, which also coincides with the harvesting season, we are anticipating a robust demand in the coming months,”said Hemant Sikka, President of the farm equipment segment at M&M.
Bajaj Auto sales up marginally m-o-m: Bajaj Auto Ltd sold 3,73,270 units in August, an increase of 1.12% over July, according to its exchange filing.
Sales snapshot (m-o-m)
- Total domestic two-wheeler sales rose 1.11% to 1,57,971 units.
- Total two-wheeler exports rose 15% to 2,00,675 units.
- Total commercial vehicle sales fell 9.3% to 34,960 units.
TVS Motor sales up by 4.2% m-o-m: TVS Motor Co’s total sales rose 4.2% m-o-m to 2,90,694 units in August, the company said in a statement. The Chennai-based two-and three-wheeler maker said with the pandemic restrictions easing and the festive season soon approaching, it expects retail sales to improve significantly in the coming months.
Ashok Leyland sales up 8.2% m-o-m: Ashok Leyland Ltd reported overall sales of 9,360 units in August, an increase of 8.2% over July, according to the company’s exchange filings. Domestic sales rose to 8,400 units from 8,129 units in August. Domestic medium and heavy commercial vehicle sales rose to 3,986 units from 3,473 units in August.
Outlook
A media report states that electronic parts and components account for 40% of the cost of a new internal combustion engine (ICE) car, up from 18% in the year 2000. We are likely to see sales further declining as the companies are forced to slash their production in the coming months due to chip shortage.
Leave a Reply