India’s Auto Parts Industry Hits Rs.7.60 Lakh Crore As Global Sourcing Shift Boosts Growth
Can India’s Auto Components Industry Continue Its Record-Breaking Growth?
India’s auto components sector has delivered another milestone year. Powered by strong domestic vehicle production, rising exports and higher investments in manufacturing capacity, the Auto Components Sector FY2025-26 recorded its highest-ever turnover of ₹7.60 lakh crore ($85.9 billion).
While global geopolitical uncertainties remain a challenge, industry leaders remain confident that the sector will continue its growth journey in the current financial year.
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India’s Auto Parts Industry FY2025-26 Registers Record ₹7.60 Lakh Crore Turnover
The Automotive Component Manufacturers Association of India (ACMA) on Tuesday announced that the Auto Components Sector FY2025-26 recorded a turnover of ₹7.60 lakh crore ($85.9 billion), registering a 12.7% year-on-year growth over ₹6.74 lakh crore reported in the previous fiscal.
The industry’s strong performance was driven by robust domestic demand, higher automobile production, sustained investments in technology and capacity expansion, along with steady export growth.
Over the last five years, the industry has more than doubled in size, expanding at a 17% compound annual growth rate (CAGR), highlighting India’s growing competitiveness in global automotive manufacturing.
FY26 Performance at a Glance
| Metric | FY26 |
|---|---|
| Industry Turnover | ₹7.60 lakh crore ($85.9 billion) |
| YoY Growth | 12.7% |
| Five-Year CAGR | 17% |
| OEM Supplies | ₹6.63 lakh crore (+16.3%) |
| Aftermarket | ₹1.08 lakh crore (+9%) |
| Exports | $24 billion (+5%) |
| Imports | $25.4 billion (+13%) |
| Trade Balance | Deficit of $1.37 billion |
| EV Components Share | 4.6% of domestic OEM supplies |
| FY27 Growth Outlook | 8%–10% |
Indian Auto Component Industry FY2026-27 Turnover Projection
| Growth Rate | Projected Turnover (INR) | Projected Turnover (USD)* |
|---|---|---|
| 8% Growth | ₹8.21 lakh crore | $92.77 billion |
| 10% Growth | ₹8.36 lakh crore | $94.49 billion |
*Approximate USD values based on the FY2025-26 conversion used in the base data.
Calculation
Lower Estimate (8% Growth)
- FY2025-26 Turnover = ₹7.60 lakh crore
- ₹7.60 × 1.08 = ₹8.208 lakh crore
- Rounded: ₹8.21 lakh crore ($92.77 billion)
Upper Estimate (10% Growth)
- FY2025-26 Turnover = ₹7.60 lakh crore
- ₹7.60 × 1.10 = ₹8.36 lakh crore
- Projected: ₹8.36 lakh crore ($94.49 billion)
FY2025-26 Performance Snapshot
| Metric | Value (INR) | Value (USD) | YoY Growth |
|---|---|---|---|
| Total Turnover | ₹7.60 lakh crore | $85.9 billion | 12.7% |
| OEM Supplies | ₹6.63 lakh crore | $74.9 billion | 16.3% |
| Aftermarket | ₹1.08 lakh crore | $12.3 billion | 9.0% |
| Exports | — | $24.0 billion | 5.0% |
| Trade Deficit | — | $1.37 billion | — |
Here’s What Happened Today and Why Traders Reacted
The latest ACMA report reinforced confidence in India’s automobile manufacturing ecosystem.
Key highlights include:
- Auto components turnover reached ₹7.60 lakh crore.
- Industry posted 12.7% annual growth in FY2025-26.
- Sector expected to grow 8-10% in the current fiscal.
- OEM supplies rose 16.3%.
- Exports increased 5% to $24 billion.
- Aftermarket business expanded 9%.
- EV components accounted for 4.6% of domestic OEM supplies.
The data strengthened investor sentiment towards listed auto component manufacturers and companies linked to India’s automobile supply chain.
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Domestic Demand and Vehicle Production Continue to Drive Growth
Sales to Original Equipment Manufacturers (OEMs) climbed 16.3% to ₹6.63 lakh crore ($75 billion) as vehicle production remained strong across passenger vehicles, commercial vehicles and two-wheelers.
The aftermarket business also maintained healthy momentum.
Revenue from replacement parts increased 9% to ₹1.08 lakh crore ($12.3 billion), supported by a growing vehicle population and increasing formalisation of India’s vehicle repair ecosystem.
Exports Continue to Grow Despite Global Challenges
India’s auto component exports rose 5% during FY2025-26 to $24 billion (₹2.12 lakh crore).
Europe emerged as the fastest-growing export destination, while engine components, transmission systems and steering components accounted for more than half of total exports.
However, imports increased at a faster pace.
Imports climbed 13% to $25.4 billion (₹2.24 lakh crore) due to higher demand for advanced technologies and specialised components, resulting in a trade deficit of $1.37 billion.
China, Japan and Germany remained India’s largest sourcing markets.
ACMA Sees India Emerging as a Global Manufacturing Hub
ACMA Director General Vinnie Mehta said India’s position in global automotive supply chains continues to strengthen.
“FY26 reaffirmed the strength and resilience of India’s auto component industry. Robust domestic demand, continued investments in capacity and technology, and the confidence of global customers enabled the industry to deliver another year of healthy growth despite a challenging international environment.”
He added:
“As global supply chains continue to diversify, India is steadily strengthening its position as a trusted manufacturing and sourcing partner for the global automotive industry.”
Listed Auto Component Stocks That Could Benefit
India’s auto component industry is expected to continue benefiting from rising domestic vehicle production, increasing exports, higher localisation and accelerating EV adoption. Companies with strong OEM relationships, global manufacturing footprints and advanced technology capabilities are well positioned to capitalize on these trends.
| Company | Potential Trigger | Strategic Focus Area |
|---|---|---|
| Samvardhana Motherson International | Export growth and global sourcing | Global OEM partnerships, wiring harnesses, mirrors, polymer modules |
| Bharat Forge | Global OEM demand | Automotive forgings, industrial, aerospace and defence components |
| Sona BLW Precision Forgings | EV component growth | Electric drivetrains, differential gears and traction motors |
| Uno Minda | Domestic OEM demand | Premium vehicle electronics, lighting and vehicle interiors |
| Bosch Limited | Advanced technology demand | Safety systems, electronics, fuel injection and EV technologies |
| Endurance Technologies | Two-wheeler production | Aluminium die-casting, braking systems and suspension components |
| Sundram Fasteners | Export opportunities | High-tensile fasteners, precision components and EV parts |
| ZF Commercial Vehicle Control Systems India | Commercial vehicle demand | Advanced braking systems, vehicle safety and fleet technologies |
Industry Expects 8-10% Growth Despite Geopolitical Risks
ACMA expects the Auto Components Sector FY2025-26 momentum to continue, with the industry projected to grow 8-10% during the current fiscal.
According to Vikrampati Singhania, President of ACMA and Vice Chairman & Managing Director of JK Fenner (India), long-term growth drivers remain intact.
“Growing domestic demand, infrastructure-led economic growth, expanding manufacturing investments, deeper global integration through free trade agreements and increasing global sourcing from India are creating significant opportunities for the sector.”
However, he cautioned that geopolitical developments, supply-chain disruptions, logistics costs, raw material volatility and the availability of critical minerals such as rare earth magnets remain important risks.
What’s Driving the Industry’s Growth?
Strong Domestic Vehicle Production
Supplies to original equipment manufacturers (OEMs) increased 16.3% to ₹6.63 lakh crore, driven by higher production across passenger vehicles, commercial vehicles and two-wheelers. Domestic demand remained the largest growth engine for the industry.
Expanding Aftermarket
The replacement market continued to expand as India’s vehicle population increased. The aftermarket grew 9% to ₹1.08 lakh crore, supported by rising vehicle ownership and increasing formalisation of the repair and service ecosystem.
Healthy Export Growth
Exports climbed 5% to $24 billion, with Europe emerging as the fastest-growing export destination. Engine components, transmission systems and steering components accounted for more than half of India’s component exports.
Electric Vehicle Components Gain Momentum
Electric mobility is gradually becoming a meaningful contributor to industry revenues.
ACMA said EV components accounted for 4.6% of domestic OEM supplies, excluding lithium-ion batteries.
The industry also sees greater opportunities in localisation of advanced technologies as imports of specialised components continue to rise.
According to Mehta, increasing localisation, technology development and innovation will be critical for improving India’s long-term competitiveness.
What Impact Did This Have on the Stock Market?
The strong industry data is expected to support investor sentiment for listed auto component manufacturers, automobile companies and ancillary businesses.
Companies with diversified export exposure, strong OEM relationships, EV-focused product portfolios and localisation capabilities could remain key beneficiaries if industry growth continues at the projected pace.
What Should Investors Watch Next?
For investors, the latest ACMA report reinforces the long-term structural growth story of India’s automotive manufacturing sector.
Key factors to monitor include:
- Domestic vehicle sales.
- Export demand from Europe and other markets.
- Progress in EV component manufacturing.
- Localisation of advanced technologies.
- Raw material prices and supply-chain stability.
- Government policy support and free trade agreements.
With the industry targeting another 8-10% growth this fiscal, the Auto Components Sector FY2025-26 remains one of the strongest manufacturing themes for investors, although global geopolitical developments and supply-chain risks will continue to influence the sector’s outlook.
