The global automotive industry has been impacted due to shortage of semi-conductors and the Indian automotive sector is no exception. The average wait time for popular SUV's and sedans is anywhere between 5-9 months and that is mainly due to the shortage of electronic control units & other micro-chips that go into an average car.
One of the largest suppliers of these electronic components, Continental Automotive has now said the semi-conductor shortage is likely to continue throughout 2021.
"OEM's increased manufacturing after lock down much more than expected. Over booking of semi-conductors from telecom and gaming industry has created a shortage. Additional volumes of semi-conductors required may not be available before 6-9 months. In our assessment, shortage of semi-conductors will continue throughout 2021," said Prashanth Doreswamy, managing director of Continental India in an exclusive interview to CNBC-TV18.
The country head for Continental Automotive said that while the company is trying to minimise the impact and fulfill orders, there may be some OEM’s who would have to interrupt production in the coming days.
"We are hoping to be over with the semi-conductor shortage by 2021. Continental is also taking steps to secure supplies of semi-conductors for 2022. Two wheeler manufacturers have also been impacted as they have electronic fuel injection systems, ABS & instrument clusters which use micro-chips," said Doreswamy.
He also pointed out that the Texas power outage and Japan earthquake had further disrupted production of companies involved in semi-conductor production.
Continental has also welcomed new rules mandating dual front air bags from the April 1. "Continental is the biggest maker of air bag ECUs. Investment plans towards additional airbag volumes have been in place for two years," said Doreswamy.
He also said the government's ambitious flagship Productivity-Linked Incentive (PLI) scheme would drive localisation and improve India’s position as a global manufacturing hub.