The Indian automotive component industry achieved its highest-ever turnover of INR 5.6 lakh crore (USD 69.7 billion) during the fiscal year 2022-23, according to the findings of the Industry Performance Review released by the Automotive Component Manufacturers Association of India (ACMA).
The report highlights a remarkable growth rate of 32.8% compared to the previous fiscal year, underscoring the industry’s robust performance amidst challenging economic conditions. Vinnie Mehta, Director General of ACMA, attributed this success to several contributing factors. He said, “The auto component industry’s stellar performance in FY23 can be attributed to robust vehicle sales, a thriving aftermarket, and steady exports.”
Sharing his insights on the performance of the industry, Sunjay Kapur, President, ACMA & Chairman, Sona Comstar said, “It is pertinent to note that apart from growth in vehicle sales, significant higher value addition from the component sector has led to its noteworthy performance in FY23. On the front of trade, it is appreciable that there has been steady growth in exports despite recessionary trends in Europe and the US which are key export destinations for the auto components industry. Strong rebound in vehicle sales in the domestic market also led to sharper rise in imports that has translated into trade deficit this year.”
Discussing the outlook for the near future, Kapur expressed optimism about the industry’s performance in the coming fiscal year. He said, “Whilst the automotive value-chain faced significant disruptions in wake of the pandemic, vehicle sales, especially in the PV, CV and tractor segments have now reached pre-pandemic levels. Even the two-wheeler industry has recovered well. With significant mitigation in the supply-side issues of availability of semiconductors, input raw-material costs and logistics, the vehicle industry is expected to continue to perform well in FY24, which augurs well for the auto components sector. That apart, exports and growth in domestic aftermarket continue to be robust.”
Despite facing recessionary trends in major export markets like Europe and the US, India’s auto component exports witnessed a growth of 5.2%, totaling INR 1.61 lakh crore (USD 20.1 billion) during the fiscal year. North America, Europe, and Asia accounted for the majority of exports, with North America experiencing an impressive 8% growth.
The report also highlights the impact of increased vehicle movement and demand for used vehicles post-pandemic, leading to buoyancy in the aftermarket across all segments. The aftermarket’s turnover for FY 2022-23 reached INR 85,333 crore (USD 10.6 billion), a significant surge from the previous year’s INR 74,203 crore (USD 10.0 billion).
