AHMEDABAD: Shortage of semiconductors – a key component in manufacturing chips of electronic devices used in auto components, has slowed car production leading to a longer waiting time for new car deliveries. Estimates by Federation of Automobile Dealers’ Association (FADA) suggest that new car models across various brands, which are more in demand have a minimum waiting of two months due to supply-side constraints.
Pranav Shah, chairman – Gujarat region, FADA, said, “New car deliveries have a greater waiting time ranging from 8-16 weeks. As more and more cars are equipped with electronic features, the requirement for semiconductor chips has gone up in car manufacturing. Carmakers across the globe are struggling for supply of these chips, due to which the growing demand is not met with. On an average, a given local dealership has at least 100 car bookings which are pending delivery.”
Shah also said that a similar wait of at least a month is being witnessed for high-end motorcycles too since a month. This is due to the semiconductor shortage which triggered supply bottlenecks.
Dealers claim that car models which are fast running tend to have a longer waiting period. “Certain models which are newly launched or some which are high in demand such as SUVs and compact SUVs tend to have a longer waiting period. We have a minimum waiting period of about 8 weeks i.e. roughly two months for cars,” said Surendra Sharma, managing director of an Ahmedabad-based car dealership.
Dealers said that shortage of Maruti Suzuki’s cars for some models from mid-sized cars to compact SUVs too is there due to the semiconductor shortage. In fact, earlier this week, Maruti Suzuki India Limited, in its regulatory filing, announced that Suzuki Motor Gujarat (SMG)’s Hansalpur plant will cut production and operate for three days a week for a month, in the wake of the semiconductor shortage.
Dealers claim that delayed delivery is causing certain customers to change their buying decision. “Some customers want a faster delivery and therefore, tend to change purchase decisions and opt for another model. At times, we do lose business because customers switch brands. However, there are good number of customers who tend to stick by their preferred model and wait it out for 2-4 months for the delivery,” said an Ahmedabad-based car dealer without willing to be named.
