problems for automobile sector..............

FOR customers looking at early car deliveries in 2011 may have to wait a little longer as manufacturers facing severe tyre shortages in local market are now hunting in China, Thailand, Korea and Malaysia to meet their new production targets. Car companies are looking at importing tyres to make up for the shortages that are affecting their 2011 production plans. Already facing component shortages that led to lower production for most car companies in 2010, major carmakers like Maruti Suzuki India, Tata Motors and Hyundai Motors are planning import of tyre, anticipating a 25% increase in production in 2011 from the 28.14 lakh cars produced in 2010 calendar year. Indian carmakers claim that tyre shortages in the domestic market have forced them to venture overseas, as the local manufacturers couldn’t meet their required demand. “Inconsistent supply of tyre has hampered production for the major part of 2010. Keeping in view the higher production targets of 2011, we have planned tyre purchase overseas markets for meeting our long-term commitments, as we aim a 14-lakh units production in next fiscal,” said a senior executive of Maruti Suzuki, who preferred not to go on record. Shortages for tyres come as carmakers are already at loggerheads with component suppliers with shortages of several critical parts affecting production. Carmakers say that sufficient component supply would have helped them to produce 20% more cars in 2010. Lower production has led to long waiting period of up to 4-5 months on many popular cars like the Maruti Swift, Volkswagen Polo, Toyota Innova. Tyre supply in the domestic market could fall short by around 10% of their demand. “While components were in short supply as demand peaked in the past few months, we do not anticipate an immediate solution in the short-term and availability of tyres is a matter of concern,” said Pawan Goenka, president, Society of Indian Automotive Manufacturers, who also head automaker Mahindra & Mahindra .