INDIA FROM COVID TO 19 As automotive sales recover, automotive OEMs are seeing a steady increase in demand for automobiles. However, the semiconductor industry is finding it difficult to meet the growing demand as it is also coping with the impact of industries such as IT, due to the COVID-19 event, home appliances, mobility, medical devices, etc., which are showing unprecedented demand. According to an Ernst & Young India report titled “Semiconductor Supply Impacts Automotive Sales: How to Effectively Manage Supply Chain Challenges through Digital Technology and Planning Solutions,” today’s semiconductors can be mitigated through effective technology-based planning. Semiconductors are becoming an important part of the DNAA of next-generation electronics such as smartphones, laptops, and automobiles. Supply chain constraints must be prioritized and addressed. ‘ Vinay Raghunath, Partner and Head of Automotive, EY India.

With work-at-home and the COVID-19 embargo, OEMs face the threat of declining consumer mobility. Automakers’ predictions were initially accurate. April 2020 through June 2020 were near zero. Ironically, demand for high-end TVs, cell phones, entertainment systems, and laptops has increased to accommodate consumers forced to stay home by the epidemic.

While the current semiconductor shortage is sure to recur over time, other similar disruptions could happen again. Automakers should proactively assess these situations using the rapid what-if scenario modeling capabilities available in modern smart digital planning solutions. Those who do so can better mitigate risk and have more opportunities in the marketplace. ‘ Yugesh Aglawe, Partner and Supply Chain Leader, EY India.

Semiconductor manufacturing is a complex and global ecosystem, making the supply chain vulnerable to macroeconomic, natural disasters and other factors. Semiconductor companies operate in countries and jurisdictions with specific national and international laws related to health and environmental regulations. One example is lithography equipment, a critical step in front-end manufacturing. One company holds more than 80% of the market share.