Continental Automotive Records Volume Erosion In 2021 Due To Semiconductor Issue

Semiconductor issue has been bothering automakers for almost a year now. It has led to production cuts across the industry and thereby pushing forward the waiting period by almost a year in case of some new and high-volume models. That said, the situation has equally disrupted the auto component industry where component makers too have witnessed production cuts. Continental Automotive, one of the leading suppliers in our market, too has seen its volumes going down within the 30 per cent bracket in 2021, which is what the global auto indistry has recorded in 2021.

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One of our company sources at Continental Automotive Brake Systems said, "When we talk about the semiconductor shortage which the world saw, as an industry globally automotive market saw more than 30 per cent volume erosion. At Continental we were able to contain the impact, we were within than number, but we also as part of the industry saw a similar volume erosion."

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According to industry experts, the headwind is likely to continue in the first half of 2022 and chip shortage challenge will remain. It's only after June 2022 that the company is expecting the situation to normalise and see some recovery. Even industry has recorded a rather lukewarm sales this festive season as deliveries were delayed and dealerships couldn't take more bookings for the period. According to a data compiled by JATO, the average discount level has shrunk more than 50 per cent since 2019 and out of 88 models sold in India, 28 models aren't attracting any discount this festive season.