According to the Automotive Component Manufacturers Association of India (ACMA), the turnover of the auto component industry increased at the fastest rate of 33% to reach Rs 5.59 trillion in 2022-23 (FY23), driven by pent-up demand, improved raw material supply, and sales of larger vehicles like sport utility vehicles (SUVs).
The manufacturers of electric vehicles (EVs) provided around 2.7% of the revenue for the auto component manufacturers. In FY22, the share was just under 1%.
While exports of automotive parts increased by 5% to $20.1 billion, imports increased by 11% to $20.3 billion. Approximately 30% of the imports came from China.
The Indian auto component sector would have double-digit growth in FY24, according to Sunjay Kapur, president of ACMA. As a result of everything “looking so good,” he continued, ACMA was having trouble identifying the headwinds for FY24.
“A battle is happening in Europe right now. However, our exports to Europe have increased by 3%. Even though there was speculation of a US recession, exports to the US increased by 8%. That has a lot to do with the China+1 approach, which is unquestionably working. The Indian component sector is also making significant investments in new technology. Because of this, it has a chance to supply the entire world, he told reporters during a news conference.”
Due to the recent deterioration in China’s relations with the majority of western nations, businesses based in these nations are searching for alternative supply bases to China. The China+1 strategy is the moniker given to this.
According to Kapur, there won’t be any “black swan” occurrences that hinder the expansion of the Indian components market in FY24.
Tesla and the federal government are now negotiating the opening of an assembly plant in India. The Elon Musk-led business, meanwhile, also desires to bring its Chinese component suppliers to India.
