Automotive Component Manufacturers Association of India (ACMA) said India’s auto component industry recorded steady growth in the first half of FY26, supported by domestic demand and a resilient aftermarket, even as exports faced pressure from higher tariffs in key overseas markets, particularly the United States.
Automotive Component Manufacturers Association of India (ACMA) reported that industry turnover increased by 6.8 percent year-on-year to INR 3.56 trillion during the April–September period of FY26, compared with INR 3.33 trillion a year earlier. The growth was driven by stable domestic demand, continued investments in capacity expansion and localisation, and technology upgrades across the sector.
Sales to original equipment manufacturers rose by 7.3 percent to INR 3.04 trillion in the first half, led mainly by passenger vehicles and light commercial vehicles. The aftermarket segment grew by 9 percent to INR 53.16 billion, supported by an expanding vehicle parc, greater formalisation in the repair and maintenance ecosystem, and wider penetration of organised distribution channels.
On the external front, ACMA said exports of auto components increased by 9.3 percent to USD 12.1 billion during the period, while imports rose by around 12.5 percent to USD 12.3 billion. This resulted in a trade deficit of USD 180 million in the first half, compared with a trade surplus of USD 150 million in the corresponding period of the previous fiscal year. The United States and Germany continued to be among the largest export destinations, while China, Japan and Germany remained the main sources of imports.
Despite the growth in exports, ACMA said new orders from US automakers have been deferred following the imposition of tariffs of up to 50 percent last year, although existing supply chains remain intact. The association noted that the depreciation of the Indian rupee against the US dollar has partially offset the impact of tariffs for exporters.
ACMA highlighted that auto component exports to the US are currently subject to a uniform tariff of 25 percent after a clarification issued from 1 November, which rolled back higher reciprocal duties applied earlier on certain commercial vehicle and off-highway components. The association said operating with such tariff levels is challenging for an industry characterised by thin margins, and the full impact is expected to become more evident in the second half of the fiscal.
Domestic market conditions remained supportive during the period, aided by a reduction in goods and services tax on select vehicle categories effective September 2025. ACMA said this policy measure has helped sustain demand momentum even as global markets remain subdued.
Electric vehicle components accounted for 4.6 percent of total supplies to OEMs in the first half, reflecting a gradual increase in EV penetration. ACMA said the operating environment continues to be influenced by geopolitical uncertainties, supply-chain disruptions, raw material cost pressures and constraints in the availability of critical materials such as rare-earth magnets, which could weigh on growth in the coming months.
