India’s Auto Component Exports See Strong Growth - News

India’s auto component exports have grown significantly in recent years, reinforcing the country’s role in the global supply chain. Key markets for motorcycle parts include Germany, Bangladesh, the US, the UK, the UAE, Brazil, Turkey, and Sri Lanka.

Industry experts suggest that India’s auto component sector has the potential to reach US$ 100 billion in exports as global original equipment manufacturers (OEMs) reconsider supply chains and manufacturing locations. This shift allows India to establish itself as a major global hub.

According to a report by the Automotive Component Manufacturers Association of India (ACMA) and Boston Consulting Group (BCG), auto component exports stood at US$ 21.2 billion in FY24. This marks a turnaround from a US$ 2.5 billion trade deficit in FY19 to a US$ 300 million surplus. The report also highlights that by focusing on 11 key product categories, particularly in the US and European markets, India could add another US$ 40-60 billion in exports.

Additionally, tapping into the emerging electric vehicle and electronic component segments through localization could generate an extra US$ 15-20 billion in exports. Components such as battery management systems, telematics units, instrument clusters, and ABS are expected to drive this growth.

Global OEMs account for 20-30 percent of India’s auto component exports. In Germany, India is seen as a cost-effective alternative to Eastern European suppliers, offering components at prices up to 15 percent lower. Meanwhile, in the US, Indian components are more competitively priced than Chinese ones, which are 20-25 percent more expensive due to additional tariffs.