Shortage of semiconductor impacts automobile production in India

MotoGazer Marui Semiconductor

The country’s largest carmaker Maruti Suzuki India one of the largest automobile manufacturer of India recorded a 51% decline in its overall production in September due to the semiconductor shortage.

As per the regulatory filing, Maruti Suzuki India produced 166,086 units overall last year. Maruti recorded low production volume in September 2021 considering the semiconductor shortage.

The usage of semiconductors in the automobile sector increased globally off late. Considering the new models have more of electronic elements like Bluetooth connectivity with driver-assist and hybrid-electric systems.

Maruti Suzuki India produced 77,782 units of overall passenger vehicles compared to 161,668 units produced during the same period last year.
The company is expecting to revive its overall vehicle production in 2 of its plants in Haryana by approximately 60% of actual capacity due to the worldwide chip shortage.
The production capacity at the 2 plants in Haryana (Gurgaon and Manesar) is approximately 15 lakh units per annum.

Moreover, the Suzuki Motor Gujarat (SMG) has an additional production capacity of 7.5 lakh units per annum. Which is a 100% subsidiary of Japan”s Suzuki Motor Corporation.

Considering the massive inflation in raw material costs, automobile manufacturers are inclined towards making high margin models. On multiple occasions, major auto automobile manufacturers like Tata Motors, Maruti and Mahindra in India have increased costs in 2021.

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