India's auto firms to give double-digit salary hikes in FY26: Deloitte

The automotive sector is poised to offer an average salary hike of 10.1% in FY26, as per Deloitte’s ‘Performance and Rewards Trends Study’ cited by The Economic Times. This projection significantly surpasses the overall average salary growth of 8% across Indian industries. Some firms completed their appraisal cycles by March 2025, while others plan to do so post-June, depending on their financial year closure. According to a Partner at Deloitte India, Mr. Neelesh Gupta, FY26 will mark the fifth consecutive year of double-digit hikes for the automotive sector, although the rate of increase has been gradually moderating since the past three years. The current projection is slightly below the 10.5% recorded in FY25 but still ahead of the estimated 8.8% average for India Inc.
This continued momentum is being driven by rising demand for specialised talent in electric vehicles (EVs), automation, artificial intelligence (AI), product engineering, and machine learning. Human Resource executives at Hyundai Motor India Ltd and Skoda Auto Volkswagen India Pvt Ltd attributed higher salary increases to this surge in demand for skilled roles. Top performers are likely to see increments well above the 10% mark. Meanwhile, India’s automobile exports grew by 19% in FY25 to over 5.3 million units from 4.5 million in FY24, as per the Society of Indian Automobile Manufacturers (SIAM). Passenger vehicle exports alone rose by 15% to 7,70,364 units. In contrast, the IT services sector is expected to witness more modest salary increases of 4% to 8.5% due to global economic pressures and changing skill requirements, suggesting a shift towards more sustainable compensation strategies amid rising AI integration. 

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