News: Indian Automotive Industry
The Indian Automotive Industry is still struggling to stabilize despite being midway through FY22. The industry is overwhelmed by the rise in input cost and the continuous semiconductor shortage. In September, the space between demand and supply widened making it a sellers market. The auto companies in India announced their shipment from factories to dealers as their monthly wholesale figures, segment report.
Due to chip shortage, Maruti Suzuki [MSIL] took a major hit and witnessed a de-growth in its local sales last month, across verticals. Nonetheless, exports for the company rose 124% in September on a year-on-year basis. Alto and S-Presso, the mini-passenger vehicles registered 14’936 unit sales in September 2021, compared to 27, 246 units in September 2020. Compact vehicles including WagonR, Swift, Celerio, Ignis, Baleno, Dzire and Tour S attained 20,891 units in the month under review, against 84,213 units in September last year.
The sale volume was negatively impacted due to the scarcity of electronic components. Further, they worked on all possible measures to limit the adverse impact. The company expressed that it is expecting total vehicle production in October, which is a festive month in India. At two of its plants, the production to be only around 60% of normal levels due to global chip shortage. OEM’s have also announced price hikes on their model range due to the rise in input cost.
Tata Motors, reported the progress of 21% said that the growth has come on the back of demand recovery post the second wave of covid. The EV segment market leader stated that the company for the second month in succession crossed 1000 units milepost for EV’s to register its highest ever monthly and quarterly sales of 1078 units and 2704 units respectively.
Shailesh Chandra, president of the passenger vehicles business unit of Tata Motors Ltd, said that EV sales attained about three-fold growth with the increasing acceptance and popularity of the Nexon EV and Tigor EV. Looking forward, demand for cars and SUVs is expected to stay strong in the upcoming festive season; although, the supply condition for electronic components may continue to witness testing times.”
Honda Cars India
Senior VP and director of marketing and sales of Honda Cars India Ltd, Rajesh Goel, said that from the demand side, there is good energy in the market with a better buying attitude. However, the supply chain difficulty including the extensive chip shortage has been a big setback. This has impacted the industries production volume and dispatches.
Although OEM’s witnessed the growth on a sequential basis. On a year-on-year basis, the segment was mostly in the red during September 2021. India’s largest two-wheeler maker Hero Moto Corp said that the increase in volumes show a measured regaining in the economy.
Honda Motorcycles & Scooters
Yadvinder Singh Guleria, Director – Sales & Marketing, Honda Motorcycle & Scooter India (HMSI) said that they are gaining back the rhythm with each passing month seeing increasing customer inquiries. The coming few months will be pivotal in determining the growth forecast. Considering the 3rd quarter of financial year comes with quite a few festivities.
Satoshi Uchida (MD- Suzuki Motorcycles) stated – they are experience a solid demand from the domestic and the global markets. However, the industry is experiencing supply issues that deter the industry efforts.
Automobile sector has been one of the most traumatized sector since the pandemic began. Will it over come the semiconductor shortage? Will it be able to revive the sector through production and sale of electric vehicles? Only the third quarter results shall state.