Indian Economy News

Auto components industry expected to grow 8-10% in FY27: ACMA

India's auto components industry is projected to register 8-10% growth in FY27, driven by sustained domestic demand and robust exports despite geopolitical uncertainties, according to the Automotive Component Manufacturers Association (ACMA). The industry recorded a turnover of Rs. 7.60 lakh crore (US$ 85.9 billion), reflecting a 12.7% growth in rupee terms over the previous fiscal. Strong demand from original equipment manufacturers (OEMs), expanding replacement markets and rising export orders continued to support the sector's growth trajectory. ACMA noted that India's automotive component manufacturers are strengthening their global competitiveness through investments in localisation, technology upgradation and manufacturing excellence.

The industry also witnessed healthy export performance, although imports remained elevated, particularly for electronics and electric vehicle components, resulting in a trade deficit. ACMA highlighted that increasing localisation of advanced components and deeper integration into global supply chains will be critical to reducing import dependence over the long term. At the same time, labour shortages, especially among small and medium enterprises, remain a challenge for the sector. Nevertheless, industry leaders remain optimistic about the long-term outlook, citing India's growing automotive market, favourable policy environment and expanding global sourcing opportunities as key growth drivers. Continued investments in innovation, advanced technologies and supply chain capabilities are expected to further strengthen India's position as a preferred global manufacturing destination for automotive components.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.