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Business

Updated on: Sunday, December 26, 2021, 03:35 PM IST

Sustaining biz operations, ensuring financial health are biggest challenges for auto sector in 2022: MG Motor

The domestic market is witnessing increased demand, but it is also impacted by the global semiconductor shortage, which has hit production activities./ Representative Image |

The domestic market is witnessing increased demand, but it is also impacted by the global semiconductor shortage, which has hit production activities./ Representative Image |

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The biggest challenge in 2022 for the automobile industry will be to sustain business operations and ensure financial health amid various challenges, including global semiconductor shortage, according to a top MG Motor India official.

Currently, the domestic market is witnessing increased demand, but it is also impacted by the global semiconductor shortage, which has hit production activities.

''The new normal has set unique challenges for the industry. The biggest challenge is to sustain business operations and ensure the financial health of the organisation and its stakeholders. With the industry having exhibited resilience over the last two years, we are looking towards 2022 with cautious optimism,'' MG Motor India President & Managing Director Rajeev Chaba stated.

The situation will remain fluidic in 2022 due to unpredictable factors – COVID-19, global semiconductor shortage, freight cost and multiple other cost implications, he added. Chaba noted that the company is committed to meet the high demand from its customers and investing to enhance the plant capacity to reduce the waiting time further.

''The company is trying to meet the growing demand and working towards strengthening the MG family in India,'' he stated.

Chaba said the company is witnessing signs of positive consumer sentiment due to pent-up demand and expects the demand to increase with the turn of the year.

''We have witnessed a year-to-date growth of 56 per cent with retail of 37,723 units (January-November 2021) over 24,152 units sold in the same period last year,'' he said.

However, the production levels are currently impacted and will remain so in the next quarter due to the global shortage of semiconductor chips, Chaba added.

The automaker, which sells models like Hector and Astor, is also looking to broaden its electric vehicle line-up in the country.

''In our endeavour to broaden access to wider customer segments, we will bring to the country the second EV, encouraged by the government's clarity on its EV road map. We are aligned to play our part in seeing that the direction meets reality sooner rather than later,'' Chaba said.

The company's ZS EV continues to attract customers in India with an average of around 700 bookings per month, he added.

(With inputs from PTI)

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Published on: Sunday, December 26, 2021, 03:35 PM IST
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