Wednesday, October 27, 2021
By Kamal Swami
One More Challenge Emerges In Front Of Indian Auto Industry
Today when the Indian auto industry is struggling with a shortage of semiconductor chips and the rising prices of steel, one more challenge has emerged in front of the auto sector. According to reports, the hike in the prices of aluminium, has appeared as a new to challenge to cope with in front of the auto industry.
It is reported, that the prices of aluminium have almost doubled from what they were in April 2020. Industry experts believe that amid the existing pressures of semiconductor shortage and hike in the steel prices, the increase in the prices of aluminium is a real big challenge for the auto sector. The unavailability of substantial ships for transportation further increases the problem. Commenting on the existing situation Ravi Bhatia, President, JATO Dynamics, “Given the supply constraints and logistical challenges, vehicle prices may take 16-18 months to adjust,". In the words of another industry expert, Shruti Saboo, Associate Director, India Rating and Research, the use of aluminium in manufacturing has increased during recent years. The use of aluminium helps in improving fuel efficiency and reducing the weight of a vehicle.
Along with aluminium, the auto sector is also suffering from a shortage of magnesium. Along with the development of aluminium alloys, magnesium is also used for developing the parts like gearboxes, fuel tank openers and seats. The main reason behind the shortage of magnesium is the recent power crisis in China. This problem is not only faced by the Indian auto industry but also the countries of the European continent are struggling with it.
