Marred By Chip Shortage PV Sales Slide 28.7% in September, Bleak Festive Season Expected

Deepanshu Taumar
02 Oct 2021
04:09 PM
2 Min Read

The passenger vehicle segment, which grew by 11% in August, slipped by 28.7% in September to close at 185,953 units, as compared to 259,981 units in the same month last year.


The passenger vehicles segment was quick to recover after being hit by the pandemic due to rising demand of personal mobility. However, the party did not last long as the chips/semiconductors, which are required to perform critical tasks in passenger vehicles, are short in numbers. 

Car manufacturers are dealing with this shortage at different levels. Some are buying from the open market while some with global footprints are able to source from their parent companies. But relentless efforts of OEMs are not yielding enough results. 

The passenger vehicle segment, which grew by 11% in August, slipped by 28.7% in September to close at 185,953 units, as compared to 259,981 units in the same month last year. 

The dip is more aggravated as India's largest carmaker Maruti Suzuki reported the steepest fall of 57.33% at 63,111 units in the month of September 2021. The company announced that the rising shortage of semiconductors has forced it to cut production to 60%. 

ManufacturerSept 2021Sept 2020% ChangeMarket Share ( %)
Maruti Suzuki63,111147912-57.3333.90
Tata Motors25,73021,20021.3613.80
MG Motors3,2412,53727.751.70

Vinkesh Gulati, President, FADA told Mobility Outlook that the situation in September is similar to what was in August. “On the retail side, opening stock really helped last month but the October stock is looking bad. If production is not improved in the month of October the retail will also slip into negative territory,” he said. 

“If good stock isn’t available, Navaratri will be just like any other month and there will be no festive cheer in sales. There is not much expectation from this festive season,” he added. 

On the semiconductor shortage, Gulati expects the situation to improve in the next three to four months, but suspects the overall situation will take six months more to stabilise.

The problem of semiconductor shortage was also reflected on sales of other leading players such as Hyundai Motor India, Kia India and Honda Cars India. The wholesale dispatches of these companies fell drastically by 34.24%, 22.68% and 33.67% respectively. 

The only silver lining among passenger vehicle manufacturers were Skoda, Renault and Nissan as they recorded higher triple digit growth due to rising demand for new products. 

Gaurav Vangal, Associate Director, IHS Markit said, “All the years, the Indian auto industry was hoping for a revival in demand, and now, when demand is peaking, there is a severe shortage of semiconductors. Such impact in sales was expected for September, and unfortunately, it will continue for this festive season. Long waiting periods are also likely to discourage further bookings from consumers.”

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