HS Alliance
The demand for the holiday season would remain strong, but the challenge of meeting that demand comes from the shortage of crisps.
A customer looks at a car at a Maruti Suzuki dealership (Image for representational purposes only)
The limited supply and growing demand have led to a long waiting period, which can last for months, for popular passenger vehicle (PV) models like Mahindra Thar, Hyundai Creta and Kia Seltos.
According to the Federation of Automobile Dealers Associations (Fada), the waiting period for the Thar diesel variant is nine to 11 months; for the essence variant of Thar, it is three to four months; for Creta and Seltos, four-six months; for Toyota’s Innova Crysta and Fortuner, five to six months; and for most other models, about two to three months. Maruti Suzuki CNG cars have a waiting period of approximately four months.
In these models, the high-end variants may have longer wait times and the entry-level ones shorter, said Vinkesh Gulati, president of Fada. EF.
“At PV dealers, there is no holiday season,” he said, referring to the fact that while demand is high, supply is limited to meet that demand. “Traditionally, as the holiday season approaches, dealerships have kept 30 to 50 days of vehicle inventory, but this has been reduced to just 15 to 20 days, the lowest this fiscal year.”
Automotive analysts EF spoke about the shortage of semiconductors (chips) that will continue to impact PV sales for the foreseeable future.
Saket Mehra, Partner and Automotive Industry Leader at Grant Thornton Bharat, said EF that buying feelings remain optimistic despite fears of a new wave. “There are many demands from customers at dealerships. Compared to July-September 2020 with sales of 6 70 722 PV, sales for July-September 2021 are slightly higher (6 81 190 units). But there is a delay in supply as manufacturers struggle to obtain critical components like chips, ”he said.
Preetam Mohan Singh, senior automotive vice president, Praxis Global Alliance, added that the chip shortage has led manufacturers to cut production by 30 to 40 percent in recent months. Maruti Suzuki, for example, cut production by 60% in September. “It is difficult to quantify the increase or decrease in sales for this year’s holiday season compared to last year, as the crisps shortage is a foreign event. The central core of the semiconductor industry is outside India, ”he said.
And then there are unexpected events, like the recent surge in Covid-19 cases in Malaysia (one of the top destinations in the world for chip assembly and testing), which further exacerbate supply issues. “Although the chip shortage is a phenomenon that is over a year old and we have found creative ways to deal with it, challenges do arise from time to time, such as the resurgence of Covid-19 cases in Malaysia. “Shailesh Chandra, president, Passenger Vehicles Business Unit, Tata Motors, said EF.
“The demand for the holiday season would remain strong, but the challenge of meeting that demand comes from the shortage of crisps.”
In modern cars, chips are used to control almost all functions, which means that even if a chip is missing, a car cannot be used. From using power windows to power steering, acceleration and braking, software codes executed on chips make these physical acts possible.
CV Raman, Technical Director of Maruti Suzuki India, said EF that contemporary cars use chips in almost every functional area, such as the powertrain, body control, steering system, brake systems, airbag system, infotainment and telematics system. vehicle, etc. This use, Raman said, will only increase with the massive arrival of electric cars.
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