India’s Auto Component Industry Accelerates to $80.2 Billion, Eyes Global Dominance by 2030: Rubix Data Sciences

India’s auto component sector is powering through global trade headwinds, growing 8.2% year-on-year to USD 80.2 billion in FY2025, according to the latest Industry Insights Report from Rubix Data Sciences. Supported by record vehicle production and stronger localisation, the industry is fast transitioning from a cost-efficient supplier to a technology-driven manufacturing hub.

The report highlights that India’s vehicle production rose 9% to 31 million units in FY2025, providing a strong domestic base for component makers. The NITI Aayog projects the sector’s turnover to almost double to USD 145 billion by 2030, while India’s share in the global auto components trade is expected to climb from 3% to 8%. Exports could triple to USD 60 billion by the end of the decade, driven by localisation, EV expansion, and rising precision manufacturing capabilities.

Rubix notes that the industry’s trade balance turned positive in FY2024 and widened further in FY2025, with exports of USD 22.9 billion marginally outpacing imports of USD 22.4 billion — a USD 0.5 billion surplus. Exports and imports have grown at 15% and 13% CAGR respectively since FY2021, reflecting the sector’s resilience despite uncertain trade dynamics.

Also Read: Despite Tariffs and Wars, India's Auto Component Industry Grows Nearly 10% in FY25, Post Trade Surplus of $453 Million | Republic World

However, potential US tariffs of up to 50% on imported components could impact nearly one-fifth of India’s auto component exports to the American market, which currently accounts for 27% of outbound shipments. The report points out that the industry is proactively mitigating this risk through diversification — strengthening ties with Europe and ASEAN nations, while also expanding higher-value product portfolios.

A key concern identified by Rubix is India’s dependence on China for rare earth magnets — critical for EV and hybrid vehicle production. Imports worth USD 221 million in FY2025 were over 80% sourced from China. With Beijing tightening export licensing rules, India plans to triple incentives to INR 70 billion to develop domestic capacity and explore alternative sourcing from Australia, Vietnam, and South Africa.

The report also underlines the growing digitalisation of the sector. India’s Software-Defined Vehicle (SDV) market is expected to rise from USD 18.2 billion in 2025 to USD 69.5 billion by 2031, at a 24.9% CAGR. New data protection rules will further drive OEMs and component manufacturers toward robust cybersecurity frameworks and connected vehicle solutions.

“India’s auto component industry is moving beyond scale to substance,” said Mohan Ramaswamy, Co-founder and CEO, Rubix Data Sciences. “The combination of domestic demand, localization, and digital readiness is laying a solid foundation for long-term competitiveness.”