Still Not Clear To What Extent And For How Long Semiconductors Shortage Will Impact Vehicle Production In India: ACMA

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  • Any stoppage of vehicle lines has a resonating effect on the entire auto component manufacturing ecosystem
  • This is after Bosch Ltd”s submission that it has been impacted severely by supply shortage for imported micro-processors

Auto components industry body ACMA said that it is still not clear as to what extent and for how long the shortage of semiconductors will impact vehicle production in India. This is after Bosch Ltd”s submission that it has been impacted severely by supply shortage for imported micro-processors.

Automotive Component Manufacturers Association Of India (ACMA) president Deepak Jain said that incidents such as these only precipitate the need for localisation and self-reliance in auto electronics in the country. He said in a statement that ACMA is keenly watching the situation as it unfolds. It is still not clear as to what extent and for how long the shortage of semiconductors will impact vehicle production in India. He added that any stoppage of vehicle lines has a resonating effect on the entire auto component manufacturing ecosystem. Jain added that ACMA is continuing to engage with the OEMs and monitoring the situation.

Need for localisation and self-reliance in auto electronics

He said that the electronic content in vehicles has been progressively increasing and incidents such as these only precipitate the need for localisation and self-reliance in auto electronics in the country.

Recently, , Bosch Ltd said that its imports of micro-processors (semiconductors) have been hit following a global surge in demand from consumer electronics industry. In a regulatory filing, the company had said that the demand in the consumer electronics industry has seen steep escalations driven by safety and hygiene sentiments . It is also due to rise of 5G connectivity. This led to a surge in global demand of semiconductors, a critical component in manufacturing of automotive electronics.

Bosch Ltd has been impacted with severe supply shortage for imported microprocessors

The company added that import of Bosch Ltd has been impacted with severe supply shortage for imported microprocessors (semiconductors). This has reduced ability to deliver to the automotive market demand in India. It added that restoration of normalcy in global supply situation for imported components and impacts are being very closely assessed and addressed on top priority.

Mahindra & Mahindra has stated that its operations in the automotive sector will be affected by the global supply shortage of micro-processors (semiconductors) used in Electronic Control Unit (ECUs) which is supplied by Bosch Ltd. M&M had said in a regulatory filing earlier this week that this is estimated to result in reduction in production/sales volume of the company (automotive division) and Mahindra Vehicle Manufacturers Ltd, a wholly owned subsidiary of the company in the last quarter of FY 2020-2021.

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