Third wave of COVID-19 has had very little impact on production as well as demand, says Maruti Suzuki

The Covid-19 pandemic's third wave has had a minimal impact on production as well as demand, said automobile major Maruti Suzuki.

Notably, the third wave's disruption has been less severe than previous phases of the pandemic.

In a conversation with IANS, Maruti Suzuki India's Senior Executive Director, Sales and Marketing, Shashank Srivastava said the company as well as the industry has coped well with the third wave.

He pointed out that it took the company 90 days to reach from 0-to-6,000 units production per day during the first wave.

"In the second wave, it took us only 18 days to reach this mark. We were able to recover in a short time as we had a good learning experience from the first wave which was implemented in the second wave," Srivastava said.

"In the third wave, there has hardly been any disruption with respect to bookings, demand or even the supply chain."

Last month, the auto major sold a total of 154,379 units which was lower than the off-take of 160,752 units reported in January 2021, on account of lower production.

Furthermore, he cited that an easing in semiconductor supply issue.

"You can see next (fiscal) year, the situation becomes much better than what we saw in the second half of this year. However, in terms of production, we will probably not be at 100 per cent production level even in this quarter."

In January 2022, the company's total production of passenger as well as commercial vehicles rose to 161,383 units from 160,975 units manufactured during the corresponding month of last year.

The global semiconductor shortage has been triggered by the Covid-19 pandemic-induced supply hurdles as well as healthy demand.

Accordingly, the phenomenon has been blamed on the exponential rise in demand for personal electronics such as cellphones and laptops during the ongoing pandemic.

On a technical basis, semiconductors play a critical part in the production of internal combustion engines. They are an integral part of all kinds of sensors and controls in any vehicle.

The shortage has extended waiting periods along with escalated prices.

On the cost pressure, he noted that even the higher vehicle prices have not been able to cover the rise in commodity prices.

"Despite all these price increases, we still find that the commodity prices have been much larger."

"The commodity prices increase in the last 1.5 years have been extremely high. The price hikes which have been undertaken by manufacturers including Maruti Suzuki are not sufficient to cover that and hence the stress on profitability for the auto industry continues."

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