India Auto Components Market to Touch $200 Bn by 2030

Amid changing global trade patterns, India is emerging as a key player helped by its cost competitiveness and skilled workforce, and the Indian auto-component industry is thus projected to touch $200 billion mark by 2030, a report by McKinsey says.

This research indicates that the rapid expansion is being fueled by the changing geopolitical and structural trade dynamics as well as the cost competitiveness of India and its highly skilled labor force.

Shaping the future of India auto component industry amid global trade shifts, the report points out that, despite the constant disruptions, global trade will grow to as much as 33 trillion in 2024 and even rise to up to 45 trillion by 2035.

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In this evolving environment, India has been gradually seizing some opportunities both in the domestic arena and the export arena where the auto components industry has registered a formidable 10 percent CAGR during the last five years.

The sales of auto components in the domestic sector are anticipated to rise 7-8 percent/year by the year 2030 due to the increase in vehicle manufacturing, use of part per vehicle, and the use of new technologies. At the export front, India may achieve a share of $70-100 billion, with the biggest export opportunities in internal combustion engines of 20-30 billion and the large domestic electric vehicle market of 35 percent CAGR.

Another approach being strengthened by industry players to increase the resilience of supply chains is through increased production at local levels, diversification of suppliers and investments in low-risk locales. India is emerging as an essential node in the changing global automobile ecosphere as firms around the world consider stability outside of China.