A stable government framework has led to the development of the Indian auto-components industry. Accounting for almost seven percent of India's Gross Domestic Product (GDP), the sector employs as many as 25 million people, both directly and indirectly.

The growth of global automobile has been expanded into the Local Equipment Manufacturers (OEMs) in India. India has become the preferred designing and manufacturing base for most global auto OEMs for local sourcing and exports.

India is an emerging global hub for sourcing auto components. It offers a favorable scenario with a trade policy without restrictions on import-export and a 100% FDI inflow.

Industry Scenario

The local industry is growing at the rapid rate of 14.3% in tandem with the parent OEM industry. Two biggest consumer segments are the Passenger Vehicles and 2 Wheelers.

Exports valued at USD 10.9 bn; growing at the YoY rate of 3.1% to reach USD 80 bn by 2026. Top 5 countries of Export include: - USA, Germany, Turkey, UK, Italy.

One of the biggest components of this industry is the aftermarket segment which is valued at USD 8.4 bn which is expected to reach USD 32 bn by 2026.


  • 1
    Rapidly growing Indian auto market to touch USD 300 bn by 2026
  • 2
    Exports to grow 5X by 2026
  • 3
    Indian Auto Components aftermarket segment expected to reach USD 32 bn by 2026



1. February 2018 - Auto maker Mahindra and Mahindra today said it has tied up with Korea-based battery manufacturer LG Chem for development of a unique cell exclusively for India.

2. September 2017 - Hella India Automotive to set up second manufacturing facility in Gujarat; plans new products for hybrids and EVs in India

3. September 2017 - Suzuki, Toshiba, Denso to jointly produce EV batteries in India

4. August 2017 - Bridgestone to invest USD 304 mn over 5 years to expand India plants. 

5. March 2017 - Motherson Sumi Systems Ltd, an automobile components manufacturer, has acquired Finland-based truck wire maker PKC Group Pic for USD 609.5 mn, which will help the company expand its presence in the global wiring harness business for commercial vehicles.

FDI Facts

5% Share of total FDI inflows

82% Jump in the auto sector FDI from 2014-2016

100% FDI allowed in the sector