SEMICONDUCTOR SHORTAGE AND INDIAN AUTOMOBILE SECTOR: EMPIRICAL ANALYSIS

ABSTRACT

The semiconductor shortage has had a signi?cant impact on the automobile sector in India. Semiconductors are a vital component in the production of vehicles, and the shortage has resulted in production delays and reduced output for many automobile manufacturers in India. This research paper examines the impact of the current semiconductor shortage on the automotive industry. The research paper begins by exploring the causes of the shortage, including the global shift towards digitalization, the pandemic-induced surge in demand for technology products, and the limited production capacity of semiconductor manufacturers. The paper then examines the economic effects of the shortage, including reduced revenues, increased costs, and reduced supply. It further explores the strategies adopted by automotive manufacturers to mitigate the impact of the shortage, such as increasing production and increasing their investments in semiconductor manufacturers. Finally, the paper discusses the implications of the shortage and suggests effective solutions to address the crisis. A simulation is carried out to forecast the strength of manufacturing in India. The ?ndings of this research indicate that the current semiconductor shortage is having a signi?cant impact on the automotive industry, and that appropriate strategies should be adopted to address the crisis.