NEW DELHI: The festive rush is there but car and two-wheeler companies, flush with orders after GST reduction and price cuts, are now facing a unique problem — ‘on time delivery’ of vehicles during festivals.
While customers are seeking delivery around Dhanteras and Diwali, companies are finding it challenging to do so due to shortage of trucks and trailers. The shortage of rare earth magnets, despite initial assurances around normalisation of supplies from China, is also delaying production, particularly of electrics and two-wheelers.
Industry officials told TOI that sudden rush in demand for deliveries — across automobiles, FMCG, ecommerce, fashion and lifestyle segments — has put a huge pressure on the truck industry with fleets working round-the-clock to deliver across the country. “Add to this the usual gifting rush around Diwali and you have a problem that is increasingly becoming very challenging to solve,” an industry official said.
“Surge in festive demand has led to significant constraints on availability of trailers. We are working to improve dispatches to our dealer network within constraints,” Nalinikanth Gollagunta, CEO, automotive division, M&M said.
The same situation is being faced by Maruti, which has seen a huge recovery in demand for small cars after GST cut. “We have pending deliveries of 2.5 lakh vehicles, and most people prefer it around Diwali . We are working overtime and are now using railways to ensure that dispatches happen faster and on time,” Partho Banerjee, senior executive officer (marketing & sales) at Maruti Suzuki , said.
Amit Kamat, chief commercial officer at Tata Motors Passenger Vehicles, said surge in demand for trailers and trucks began after Sept 22 as new GST rates came into play. “We expect this surge to be temporary and are working with logistics partners to expedite dispatches… Despite challenges, we are working tirelessly to expedite deliveries to our dealerships in time for Diwali celebrations.”
Luxury players, such as BMW, are also feeling the pinch due to sudden rush in demand. “Customers like to take the delivery on Dhanteras and Diwali. This year, demand for deliveries on these specific days is much higher as pent-up demand from Aug-Sept is also coming into play… When the bottleneck suddenly opened, there were certain logistics challenges in the start, but they are streamlined now,” Hardeep Singh Brar, president and CEO of BMW Group India, said.
It’s similar for two-wheeler industry. Apart from logistics, companies are also plagued by shortage of magnets. “The cut in retail prices has meant that there has been a sudden rise in demand for scooters and motorcycles. Rare earth magnet issue is hampering production. Sudden rush in bookings is leading to pressure on deliveries,” a top official of a leading company said.
While customers are seeking delivery around Dhanteras and Diwali, companies are finding it challenging to do so due to shortage of trucks and trailers. The shortage of rare earth magnets, despite initial assurances around normalisation of supplies from China, is also delaying production, particularly of electrics and two-wheelers.
Industry officials told TOI that sudden rush in demand for deliveries — across automobiles, FMCG, ecommerce, fashion and lifestyle segments — has put a huge pressure on the truck industry with fleets working round-the-clock to deliver across the country. “Add to this the usual gifting rush around Diwali and you have a problem that is increasingly becoming very challenging to solve,” an industry official said.
“Surge in festive demand has led to significant constraints on availability of trailers. We are working to improve dispatches to our dealer network within constraints,” Nalinikanth Gollagunta, CEO, automotive division, M&M said.
The same situation is being faced by Maruti, which has seen a huge recovery in demand for small cars after GST cut. “We have pending deliveries of 2.5 lakh vehicles, and most people prefer it around Diwali . We are working overtime and are now using railways to ensure that dispatches happen faster and on time,” Partho Banerjee, senior executive officer (marketing & sales) at Maruti Suzuki , said.
Amit Kamat, chief commercial officer at Tata Motors Passenger Vehicles, said surge in demand for trailers and trucks began after Sept 22 as new GST rates came into play. “We expect this surge to be temporary and are working with logistics partners to expedite dispatches… Despite challenges, we are working tirelessly to expedite deliveries to our dealerships in time for Diwali celebrations.”
Luxury players, such as BMW, are also feeling the pinch due to sudden rush in demand. “Customers like to take the delivery on Dhanteras and Diwali. This year, demand for deliveries on these specific days is much higher as pent-up demand from Aug-Sept is also coming into play… When the bottleneck suddenly opened, there were certain logistics challenges in the start, but they are streamlined now,” Hardeep Singh Brar, president and CEO of BMW Group India, said.
It’s similar for two-wheeler industry. Apart from logistics, companies are also plagued by shortage of magnets. “The cut in retail prices has meant that there has been a sudden rise in demand for scooters and motorcycles. Rare earth magnet issue is hampering production. Sudden rush in bookings is leading to pressure on deliveries,” a top official of a leading company said.
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