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Some AC manufacturers face supply chain constraints

Though the demand for RACs remain all-time high, several brands, especially the import dependent brands, are witnessing supply side constraints. However, industry experts feel this would have long term positive impact on the industry and aid increased and faster indigenisation.

Many, MNC brands such as Mitsubishi and O’General are facing constraints due to delay in inventory supplies from their parent entity / vendor’s plants in Thailand which are impacted by semiconductor shortage. On the other hand, domestic brands are relatively faring better than their MNC peers, due to more in-house production and domestic component sourcing.

Government policies aimed towards curbing Chinese imports are leading to lower imports when compared to earlier years and this trend is likely to accelerate even further in the coming years. As a result, Mitsubishi Electric has launched a sub-brand, which is made in India through a contract manufacturer while O’General is also likely to start making some models in India.

Meanwhile, the industry is expected to set a new record during the current season aided by early arrival of summer, record breaking mercury levels and pent-up demand. According to Consumer Electronics and Appliances Manufacturers Association (CEAMA), residential air conditioner makers are expecting record sales of around 90 lakh units this year. In April the industry has already clocked the sale of around 17.5 lakh units, which is also an all-time high for the month. Manufacturers such as Voltas, Panasonic, Hitachi, LG and Haier posted record sales in April.

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