Even though COVID-19 has impacted nearly every industry, with the auto industry being one of them, it has managed to score a respectable growth in the first half of the fiscal year. The auto components industry has managed to grow by 65% and generate a revenue of 1.96 lakh crore Rs. against Rs. 1.19 lakh crore. However, some concerns like the semiconductor shortage and high input costs are also threatening to plague the sector.
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The X-factor in the humongous growth of the auto parts business is owed to the 76 percent growth in exports. A large part of the growth was seen in the US markets where the total revenue was Rs. 68,746 crores against a revenue of Rs. 39,003 crore at the same time the previous year. The loss that the industry has faced by now owing to the semiconductor shortage is worth Rs. 1,000 crore.
According to Vinnie Mehta, director-general of the Automotive Component Manufacturers Association, the automotive industry has exhibited remarkable growth in all segments of the business. Even though the business was slow initially, it gained significant momentum in the first half of the financial year 2022. The vehicle sale issues were due to the supply side issues. Even though the industry has been growing remarkably, it has been predicted that the supply chain issues hampering the semiconductor supply will continue to negatively affect the industry.
Other issues acting as hurdles in the automotive sector include increasing input costs, rising logistics costs, availability of containers, and many more. It is to be seen what trajectory of growth the automotive sector will follow in the future.
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