With the ripple down effect of declining automobile sales, the
forging industry is facing the heat with a sharp decline in demand.
decline has resulted in substantial production cuts, according to industry body
the Association of Indian Forging Industry (AIFI). Moreover, the rise in steel
prices have further hammered the forging industry in the country and with some
car makers already indicating that vehicles will be more expensive from the
coming months, the forging and auto component industries are anticipating a
"bleak" festive season this year, the Association of Indian
Forging Industry said.
domestic forging industry primarily caters to the automotive industry, which accounts
for 60-70% of the forging production. With the auto sector witnessing the
slowdown, the forging industry has witnessed an average slowdown of 50 per cent
of the total capacity, the Association said. Due to various factors such as
semiconductor chip shortages, rising input costs, rising commodity prices, and
rising fuel costs, total automotive sales in India have declined in double
digits in FY20 and FY21.
industry anticipated a rebound for the overall passenger vehicle market
following the second wave of the COVID-19 pandemic. However, it is the supply,
not the demand, that is likely to lead to longer wait times, which will have a
long-term impact on consumer sentiment, as per the forging industry.
domestic forging industry, which is the second largest in the world, comprises
85 per cent of the MSME sector, employing over 3 lakh people
directly and an equal number of people indirectly.
the industry continues to support government in their green mission. As a
result, it is time for the forging industry to expand into non-automotive
domains such as infrastructure, defence, healthcare, and railways where the
current government is also investing heavily, he said.
Source: The New Indian Express