Auto Component Industry Grows 6.8% in H1 FY26, Exports Rise 9.3%

The Indian automotive components industry delivered a stable performance in first-half of FY 2025-26 (April–September 2025), registering an overall growth despite a challenging global environment. 

According to the Industry Performance Review released by the Automotive Component Manufacturers Association of India (ACMA), the sector grew by 6.8 percent year-on-year (YoY) to reach a turnover of ₹3.56 lakh crore (USD 41.2 billion), supported by consistent domestic demand, a resilient aftermarket, and sustained investments in localisation and capacity expansion

OEM Supplies Lead Industry Growth

Supplies to original equipment manufacturers (OEMs) remained the primary growth driver during the period. OEM sales rose by 7.3 percent to ₹3.04 lakh crore (USD 35.2 billion), with passenger vehicles and light commercial vehicles emerging as key contributors. Stable production schedules and continued demand in these segments helped component suppliers maintain order visibility and operational continuity.

ACMA noted that the performance reflects the underlying strength of India’s automotive ecosystem, with manufacturers continuing to invest in technology upgrades and capacity expansion to meet evolving OEM requirements. 

Sharing his insights on the performance of the auto components sector, Vinnie Mehta, Director General, ACMA, said, “H1 FY26 performance reflects the underlying strength of India’s automotive ecosystem, with growth across OEM supplies and the aftermarket. On the trade side, export growth has remained healthy, though imports have risen at a faster pace, leading to a marginal trade deficit.”

Aftermarket Shows Robust Expansion

The aftermarket segment outperformed overall industry growth, expanding by 9 percent YoY to ₹53,160 crore (USD 6.1 billion). This growth was driven by an expanding vehicle launches, increased formalisation of the repair and maintenance ecosystem, and greater penetration of organised distribution channels.

Improved consumer awareness, longer vehicle ownership cycles, and higher maintenance spend also supported aftermarket demand, reinforcing its role as a stable revenue stream for component manufacturers.

Export Growth Resilient Amid Global Headwinds

Exports of auto components rose by 9.3 percent in H1 FY26 to USD 12.1 billion, despite significant global headwinds such as supply-chain disruptions, raw material cost pressures, and subdued demand in key international markets. The United States and Germany continued to be among the top export destinations.

However, imports grew faster at 12.5 percent to USD 12.3 billion, resulting in a trade deficit of USD 180 million, compared to a surplus of USD 150 million in the same period last year. China, Japan, and Germany remained the leading sources of component imports, highlighting ongoing dependencies for certain critical inputs.

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EV Components Gain Traction in OEM Supplies

Electric vehicle (EV) components accounted for 4.6 percent of total supplies to OEMs in H1 FY26, underscoring the gradual but steady transition towards electrified mobility. Component manufacturers are increasingly aligning product portfolios with new-age technologies, even as internal combustion engine-based components continue to dominate volumes. ACMA leadership have highlighted that deeper localisation, stakeholder collaboration, and supply-chain resilience will be critical for an accelerated EV adoption.

Industry Outlook Supported by Policy Measures

Looking ahead, ACMA remains optimistic about the sector’s performance in the second half of FY26. Improving retail sentiment, seasonal demand, and infrastructure-led activity are expected to support growth momentum. Additionally, the reduction in GST on select vehicle categories, effective post-September, is expected to boost demand, particularly in passenger vehicles and two-wheelers, with positive spillovers for the component ecosystem.

At the same time, the industry continues to face challenges, including geopolitical uncertainties, rising freight costs, raw material price volatility, and limited availability of critical materials such as rare-earth magnets. Addressing these issues will be crucial to sustaining long-term growth and competitiveness.