This waiting list includes 2.5 lakh Maruti clients, one lakh each from Tata Motors, and Mahindra consumers, and 75 thousand Kia Motors customers. Now you may be wondering why these companies are unable to deliver new vehicles when individuals are willing to pay higher costs for them.
If you’re considering buying a new car, you should be aware of the waiting list, which now has 7 lakh individuals in line. These are people who had made reservations with various firms to purchase a new vehicle a long time ago, but these companies have yet to deliver the new vehicle to their clients.
How many clients are there in line for which company?
How many consumers of which automobile manufacturer are anticipating the arrival of their new vehicle? This waiting list includes 2.5 lakh Maruti clients, one lakh each from Tata Motors, and Mahindra consumers, and 75 thousand Kia Motors customers. Now the issue will arise in your mind as to why these corporations are unable to deliver new vehicles while individuals are willing to pay higher costs for them.
Vehicle deliveries were halted due to a semiconductor chip failure.
The reason for this is that there is a global scarcity of semiconductor chips. Despite the fact that this chip is the size of a matchbox, it has shook the world’s 170 industries. The automobile industry is the one that has been hit the worst.
The car sector has suffered a loss of Rs. 150 lakh crore.
Due to a lack of semiconductor chips, the auto sector has lost Rs 150 lakh crore this year. The fact that many countries’ economies have been threatened by a lack of semiconductor chips can be used to predict a shortage of semiconductor chips. Toyota is based in Japan. The headquarters of major automobile manufacturers such as Suzuki and Nissan are located here. The shortage of chips has resulted in a significant financial loss.
Japan’s exports dropped by 46%.
Japan’s exports fell by 46% in September 2021 compared to the same month in 2020. This is enough to destabilize any country’s economy. Similarly, the scarcity of chips has caused significant losses in Central European countries. In India, the auto sector accounts for 6.4 percent of the country’s GDP. About 3 crore people’s homes are on the move as a result of this. And India has suffered greatly as a result of this.
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In an automobile, there are over a thousand semiconductor chips.
Today, all vehicles built throughout the world employ semiconductor chips for power steering, braking sensors, entertainment systems, airbags, and parking cameras. In most cases, a car contains over a thousand semiconductor chips. These chips are computer-based, and they process your vehicle’s data as well. Without semiconductor chips, modern vehicles are nearly impossible to construct.
Chips that are used in these gadgets
This chip is utilised in any modern gadget that is connected to the Internet and has particular characteristics, not just autos. Mobile phones, laptops, televisions, and other household equipment are examples. As a result, the shortage has had an impact on their production. Apple had planned to create 90 million iPhone 13s this year, but only 80 million were produced due to a shortage of semiconductors.
Chip shortages will last until 2023.
Chip’s issue is primarily the fault of Covid-19. The coronavirus caused a reduction in semiconductor chip production around the world for a year, and the supply is still far less than the demand. The most serious issue is that just a few companies in the world are capable of producing semiconductor chips. These businesses have also expanded their output, although the shortage will still exist by 2023.
There is no semiconductor chip manufacturing firm in India.
Apart from that, a significant difficulty is that no Indian company produces semiconductor chips, leaving India fully reliant on imports in this area. The majority of these chips are shipped to Indian automakers from Malaysia, where production is currently halted owing to Corona. So, if you want to buy a new vehicle for the approaching festivals, you may not be able to get it delivered on time and may have to pay a higher price. Consider it as if you ordered a car now, but it won’t be delivered for another six months, in May or June next year. So, in this circumstance, you will not have to pay the present automobile price, but rather the price that will be in effect in May or June, and this price will be high, because the car producers’ input cost, i.e. the cost of building, is only a fraction of the total cost. The average has increased by 6% in the same year.
What is the solution to this problem?
According to all of the major corporations, the chip issue will last through 2022, and the situation will improve by 2023. As a result, if you want to, you can put off getting a new car for a time. You could also consider purchasing a used vehicle. This is something that a lot of individuals do. According to a survey, due to a shortage of timely delivery of new vehicles, the market for used vehicles is fast growing. According to estimates, the sale of old vehicles in India was one and a half times that of new vehicles this year, and this figure is expected to treble by 2025.
The plan of the central government to deal with the situation
Apart from that, the national government has approved a new scheme worth Rs 76 thousand crores to hunt for chances in this crisis, with the goal of making India self-sufficient in semiconductor chip production within the next six years.
