Chip Shortage, High Input Costs Limit Auto Sales Rebound In October
Sales of cars and utility vehicles rebounded in October as automakers pushed stocks to dealers in the festive season even as concerns over a global chip shortage persist.
Domestic wholesales of passenger vehicles rose 41% over the preceding month to 2.26 lakh units in October, according to data released by the Society of Indian Automobile Manufacturers.
SIAM numbers for October 2021 (MoM)
Car sales jumped 62% to 1,03,829 units.
Wholesales of utility vehicles rose 28% to 1,12,112 units.
Total two-wheeler sales rose 0.86% to 15,41,621 units.
Motorcycle sales increased 7.3% to 10,17,874 units
Scooter sales fell 9.6% to 4,67,161 units
Three-wheeler sales increased 8.8% to 31,774 units.
Year-on-year, however, passenger vehicle sales were down 27%, while two-wheeler sales declined 25%.
“Chip shortage and steep hike in raw material cost have been a major spoilsport for the industry in the festive season,” Rajesh Menon, director-general at SIAM, said in a statement. “Manufacturers were banking on the festive season to recover from the severe drop in sales in early part of FY22.”
Automakers’ business was on the decline in the years leading to the Covid-19 outbreak. As a result, sales and production ground to a halt for the first time last year. Demand for cars and utility vehicles bounced back as the restrictions ended. But a global shortage of semiconductors—the brains of electronic components inside cars that control everything from steering to emissions—worsened, hurting the companies’ ability to keep up with the rising demand.
Automakers such as Maruti Suzuki India Ltd., Mahindra & Mahindra Ltd. and MG Motors, in their monthly sales statement released on the bourses, said the supply-chain issues continued to hurt production in October.