New Delhi7 hours ago
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The reduction in raw material prices amid long waiting has raised hopes of the country’s auto industry returning to the ‘achche din’ this year. It is estimated that this year there will be record sales of cars. Buyers can get the benefit of this in the form of discounts or offers.
Manufacturer’s gross margin expected to increase due to reduction in price
In the last 3 years, the country’s auto industry has faced many problems like lockdown, increase in raw material prices, supply chain problems, shortage of semiconductors and other components, expensive fuel. However, now, the prices of steel, aluminium, copper, palladium have come down by 10-20% in the last month. These metals account for 70% of the car making. Due to the reduction in their prices, the gross margin of the manufacturer is expected to increase.
The shortage of semiconductors has also been overcome to a large extent, that is, there is no problem in production. On the other hand, the backlog of cars in the country is over 6 lakhs, half of which is from Maruti Suzuki alone. In such a situation, there is no problem of demand in front of the car companies. Due to the reduction in excise on petrol and diesel, their prices have come down. This has improved the sentiment of the buyers. Experts are considering all these factors as the beginning of good days for the auto industry.
Supply shortage and chip crisis is coming to an end
Maruti Suzuki Executive Director Shashank Srivastava said in a conversation with Dainik Bhaskar that this year is expected to be historic for the sales of passenger cars. Breaking the record of 32.8 lakh cars sold in 2017-18, 33.5-35.5 lakh cars can be sold this year. However, there is no scope for a reduction in the price.
Automobile expert Sanjeev Garg says, “Supply shortage and chip crisis are also slowly coming to an end. There is no chance of reduction in the prices of the vehicles, but the companies will definitely try to pass on the benefits to the customers through offers and discounts.