InvestorQ : Is the auto industry in India finally getting out of its microchip shortage?
Lavanya Subramanian made post

Is the auto industry in India finally getting out of its microchip shortage?

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Anamika Sodhani answered.
2 months ago
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If the latest feedback coming from Maruti Suzuki is to be considered, the chip shortage is abating but it is far from over. Even M&M had said that the situation is improving. However, even the auto companies expect this short fall overall to continue till the third or even the fourth quarter of FY23. The semiconductor shortage has hit the auto companies quite badly in the last two years as the supply of microchips just failed to keep pace with rising demand and auto stocks suffered as they had the least long term agreement for chip supplies.

In fact, senior officials of Maruti Suzuki even confirmed that semiconductor supplies had reached 95% levels but would take some time to touch 100% levels. Hence, the shortfall could continue well through FY23. It may be recollected that back in September 2021, the chips shortage had led to auto production falling to 40% of normal level across the board. That has gradually picked up to around 90% in the months of June and July. The chip shortage will take some time before full production can be restored by auto companies.

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