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Automakers ramp up chip supply, July shipments hit record high

India’s passenger vehicle industry is expected to post its best monthly shipments from factories in July as improved chip supply helps them speed up delivery of cars and SUVs to some 700,000 waiting customers. According to several industry executives and experts, July passenger vehicle shipments are estimated at around 350,000 units, valued at around ₹25,000 crore.

That’s a significantly high number for what is typically a lean month. The previous peak of 334,000 units was recorded in October 2020. Over the past five years, automakers billed between 200,000 and 299,000 units in July, with the highest in 2017. Indian auto market supplies had been unable to respond for almost a year. increased demand for personal mobility, creating a large backlog. Automakers have had to cut production due to a shortage of semiconductors. With the improved supply of chips, these companies are now increasing their production.

Shashank Srivastava, senior executive director at the market leader

said shipments this month would likely be among the highest in the industry, although retail sales may not be that high.

“Shipments cannot reflect actual demand and this has been the case for about a year in an environment of supply constraints. In July, most automakers are filling pending reservations,” he said. , without disclosing. any number. “While new launches continue to attract higher bookings, older models have started to experience some kind of softening due to macroeconomic parameters such as interest rates, inflation, fuel prices, among In the case of Maruti, our position has been strengthened thanks to two new SUVs”, he added.

India’s top five automakers are expected to contribute 80-83% of the total industry volume for July 2022, and the largest automaker’s share is estimated at 41-43%. In 2022, it is the fourth month that factory shipments exceeded 300,000 units. The average volume for the past year was 277,454 units.

So far in FY23, the average wholesale number is around 314,000 units per month and if this trend continues, it will translate to a total volume of 3.7 million vehicles this year, an increase of 24% from 2021. Light-duty vehicle production in India is expected to surpass its previous high in 2022, S&P Global said due to buoyant demand.

Gaurav Vangaal, associate director, light vehicle production forecast, at S&P Global Mobility, said that with improved semiconductor supply, the consultancy has raised its market growth forecast for 2022. at 17-20% versus 13%. “The strong domestic order book and increasing number of exports helped India maintain robust numbers. H1 2022 showed 3% growth compared to H1 2018, we expect CY 2022 to be the best year ever for Indian light vehicle production,” he added.

Among the major light vehicle producing countries, India is the only country to post double-digit growth for consecutive years.