Rising geopolitical tensions in West Asia are beginning to impact India’s consumer durables sector, with appliance manufacturers warning that a shortage of commercial LPG cylinders could disrupt the production of air conditioners just as the peak summer season approaches.
According to a report by Business Standard, LPG-used in manufacturing processes such as brazing and powder-coating curing-has become difficult for companies to procure. The restricted supply is creating production bottlenecks for air-conditioner manufacturers preparing for the high-demand summer period.
Industry leaders have raised concerns about the situation. Kamal Nandi, business head and executive vice president of the appliances business at Godrej Enterprises Group, said tensions in West Asia have started affecting supply chains and creating challenges for manufacturers dependent on LPG in their production processes.
Similarly, B Thiagarajan, managing director of Blue Star Limited, noted that while the company currently has some LPG inventory, prolonged restrictions on commercial cylinder supplies could soon affect air-conditioner production.
The report also highlights additional pressure from rising raw material costs. Prices of plastics such as polypropylene and polystyrene, commonly used in appliances like refrigerators, washing machines and air conditioners, are tightening due to supply constraints.
At the same time, key metals used in appliance manufacturing are becoming more expensive. Copper prices have increased by nearly 25% in recent months, while aluminium prices are hovering near record highs, adding further cost pressures for manufacturers.
The supply concerns come at a critical time for the industry. Companies had expected strong growth this summer, particularly after last year’s cooling appliance demand was weakened by early rains and a prolonged monsoon.
For example, Voltas Limited had projected around 25% growth in the room air-conditioner segment this season. However, continued supply disruptions could threaten production plans just as demand begins to surge.
