India Automotive Components Market By Vehicle Type (PC, LCV, M&HCV, 2W, 3W, OTR), By Demand Category (OEM, Replacement), By Component Type (Engine parts, Body, Chassis, Suspension, Brakes, etc.), Competition, Forecast and Opportunities 2011-2021
Published Date: May - 2025 | Publisher: MIR | No of Pages: 320 | Industry: Automotive | Format: Report available in PDF / Excel Format
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India Automotive Components Market has valued at USD 56 Billion in 2023 and is anticipated to project robust growth in the forecast period with a CAGR of 5.34%.
India's automotive components market presents a significant growth opportunity driven by the increasing demand for automobiles and advancements in technology. With the Indian government's push towards electric mobility and stringent emission norms, there has been a marked shift in focus towards developing high-performance, energy-efficient components.
Key Market Drivers
Strong Growth in the Automobile Industry
One of the major drivers of the India Automotive Components Market is the strong growth in the automobile industry. India is one of the world's largest automotive markets, with increasing demand for vehicles from small cars to commercial trucks. This spurt in automobile production propels the need for automotive components, ranging from engine components to electronics, interior trim, and safety systems. With the expansion of auto manufacturing operations in India by auto makers to meet local as well as global demand, the automotive components industry continues to grow steadily.
Growing Vehicle Ownership and Fleet Size
The increasing ownership of personal cars and expansion of commercial vehicle fleets are major drivers for the automotive components industry in India. With the growing urbanization and economic growth, more people and businesses are investing in cars for personal and commercial purposes. This creates a steady demand for replacement parts and components, which adds to the aftermarket part of the business. Vehicle owners and fleet operators look for high-quality components to repair and maintain their vehicles, propelling the demand for automotive components.
Technological Developments and Electrification
Technological innovations in the automobile sector are key drivers of the components market. The trend towards vehicle electrification, hybrid technology, and connectivity has given rise to advanced components such as electric drivetrains, advanced sensors, battery systems, and infotainment units. Car manufacturers are now focusing more on incorporating intelligent and environmentally friendly technologies in their cars, which requires innovative products. This is a driving force behind manufacturers' investments in research and development, leading to a consistent need for innovative automobile components.
Government Regulations and Emission Standards
Government policies and emission regulations are major drivers in the India Automotive Components Market. To counter environmental issues and lower pollution, Indian government has enforced tough emission norms and safety standards. Meeting these norms involves the adoption of specialized components, including catalytic converters, exhaust systems, and safety devices. The automotive components industry has had to accommodate these regulatory updates, offering solutions that enable automakers to achieve the necessary standards.
Export Growth Opportunities
Indian auto component firms are increasingly targeting outside domestic frontiers for growth through exports. India has emerged as a leading location for components production, and several companies export high-quality products at reasonable costs. This trend has boosted export volumes of car components to numerous global markets. Demand for car components produced in India by other nations in auto manufacturing continues fueling sectoral growth.
Technological Advancements in Lightweight Materials and Fuel Efficiency
Technological advancements in materials, especially lightweight materials and fuel efficiency technologies, are leading to transformation in the India Automotive Components Market. The auto industry is seeking ways to make vehicles lighter to enhance fuel efficiency and lower emissions. This transformation has prompted the creation of components using lightweight materials like aluminum, composites, and high-strength steel. Automotive component manufacturers have made adjustment by developing innovative lightweight products, including fuel-efficient engine components and lightweight chassis components. India Automotive Components Market
Segmental Insights
Vehicle Type Insights
India's automotive components market is a vibrant and expansive landscape, encompassing various vehicle types. The passenger vehicles segment, driven by the growing middle class and increasing purchasing power, holds a significant market share. This segment includes a wide range of options, such as sedans, hatchbacks, SUVs, and luxury cars, catering to diverse consumer preferences and lifestyles. With advanced features and innovative designs, these vehicles provide comfort, style, and convenience to Indian consumers.
In addition, the two-wheelers segment demonstrates robust growth, fueled by the demand for affordable and efficient transportation solutions. This segment comprises motorcycles, scooters, and mopeds, serving as popular means of commute for individuals in both urban and rural areas. With their agility and cost-effectiveness, two-wheelers offer a convenient mode of transport, especially in congested city environments. They are also known for their fuel efficiency, making them an attractive choice for daily commuting.
Furthermore, the commercial vehicles segment is witnessing significant expansion, primarily due to the growth of infrastructure and logistics sectors. This segment includes trucks, buses, and vans, facilitating the smooth movement of goods and people across the country. As India's economy continues to grow, the demand for efficient transportation of goods and passengers is on the rise. Commercial vehicles play a crucial role in supporting various industries, ensuring timely delivery of goods and providing reliable transportation services.
Each of these automotive segments presents unique demands and opportunities for the automotive components industry in India. From manufacturing components for passenger vehicles to developing efficient solutions for two-wheelers and commercial vehicles, the industry is poised for growth and innovation to meet the evolving needs of the dynamic Indian market. With a focus on quality, technology, and sustainability, the automotive components industry in India is well-positioned to contribute to the overall growth of the automotive sector and the country's economy as a whole.
Component Insights
India's automotive component market is not only rapidly expanding but also playing a pivotal role in driving the nation's industrial growth and employment. This market has witnessed remarkable progress, thanks to the surge in vehicle production and the subsequent increase in demand for components. Moreover, several factors contribute to this upward trajectory.
Firstly, India's cost-competitive labor market has been a significant advantage for the automotive industry. Skilled and affordable labor has attracted global manufacturers to set up their production facilities in India, leading to increased employment opportunities for the local workforce.
Secondly, the thriving domestic automotive market in India has been a catalyst for the growth of the component industry. With a rising middle class and increasing disposable incomes, there is a higher demand for vehicles, which in turn drives the demand for automotive components. This sustained demand has encouraged investments in research and development, innovation, and technology advancement, further boosting the industry's competitiveness.
Thirdly, India's strategic geographic location adds to its advantage in the global market. Situated at the crossroads of major trade routes, India serves as a hub for exports to various regions. This geographical advantage allows Indian automotive component manufacturers to reach international markets efficiently, expanding their customer base and increasing export revenue.
Furthermore, the government's initiatives aimed at promoting manufacturing and favorable foreign investment policies have successfully transformed India into an attractive hub for global auto component manufacturers. The "Make in India" campaign and various incentives for setting up manufacturing units have encouraged both domestic and foreign companies to invest in the sector. This has not only boosted production capacity but also facilitated technology transfer and collaboration, fostering growth and innovation in the industry.
With all these factors combined, India's automotive component market continues to flourish, cementing its position as a key player in the global automotive industry. The continuous focus on improving quality, innovation, and cost competitiveness, coupled with a supportive policy environment, ensures that India remains a preferred destination for automotive component manufacturing and a significant contributor to the country's overall economic growth.
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Regional Insights
India's automotive components market has witnessed significant and sustained growth in recent years, owing to the dynamic and ever-evolving nature of the automotive industry. This expansion can be attributed to a multitude of factors that have contributed to its success. Firstly, the rapid growth of India's middle class, coupled with an increase in disposable income, has fueled the demand for vehicles and subsequently boosted the automotive components market. Additionally, India's strategic geographic location, which allows it to effectively serve key global markets, has further enhanced its position as a prominent hub for auto components manufacturing. Moreover, the government's proactive initiatives aimed at promoting local manufacturing have played a pivotal role in attracting investments and fostering the growth of the sector.
However, it is important to acknowledge that the market also faces certain challenges that need to be addressed. For instance, infrastructural deficiencies pose a significant obstacle to the seamless functioning of the automotive components industry. Furthermore, there is a pressing need for technological advancements in order to meet global standards and remain competitive in the international market.
In conclusion, the automotive components market in India is experiencing a remarkable growth trajectory, driven by various factors such as the expanding middle class, rising disposable income, strategic location, and government support. Nevertheless, overcoming infrastructural limitations and embracing technological advancements will be crucial for the sustained progress and long-term success of the industry.
Recent Developments
- In 2023, Toyota has announced that it is localizing its e-drive transmission system for hybrid vehicles.
- In 2022, Allison Transmission has partnered with Chinese Bus OEMs to Drive Export Growth.
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Key Market Players
- Bosch Ltd
- Bharat Forge Ltd
- Sundaram Clayton Ltd
- Minda Industries Ltd
- Endurance Technologies Ltd
- Motherson Sumi Systems Ltd
- Exide Industries Ltd
- Amara Raja Batteries Ltd
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