Indian automobile industry struggling with supply shortfalls

Automakers forced to introduce waiting lists on popular models; seeking out overseas partners to source components

Indian automotive components manufacturers in the world’s third largest automotive market are getting prepared for a crucial period ahead as they try to deal with battles on several fronts; to keep costs down whilst raw material prices fluctuate, expand capacities, pay down debt, and meet an unanticipated surge in the demand. The unprecedented buoyancy in automobile market in the country has already created a widespread shortage in auto parts that is has the potential to cause further problems in the coming few months, overstretching the demand side and to some extent curbing the auto sector’s fast growth. The mismatch between the production/supply and consumption/demand side of the components domain is hampering assembly schedules of automakers operating there, prompting them to look for other options to overcome the shortfall and to complement their local supplies, including sourcing parts from global suppliers to complete their order backlogs.