The automotive component industry that contributes 2.3 percent to India’s GDP and has a share of four percent in India’s exports, stood at Rs.3.45 lakh crore (USD 51.2 billion) for the period April 2017 to March 2018, registering a growth of 18.3 percent over the previous year, reveals the Industry Performance Review of Automotive Component Manufacturers Association of India (ACMA).
“The year has gone by witnessed an upswing in the overall performance of the vehicle industry, despite it facing several regulatory challenges. The component industry, in tandem, posted an encouraging performance with significant growth of 18.3 percent over the previous fiscal, registering a turnover of Rs. 3,45,635 crore (USD 51.2 billion). Further exports, grew by 23.9 percent in FY 2017-18 to Rs.90,571 crore (USD 13.5 billion),” said Vinnie Mehta, Director General, ACMA.
Key findings of the review
- Exports of auto components grew by 23.9 percent to Rs 90,571 crore (USD 13.5 billion) from Rs 73,128 crore (USD 10.9 billion) in 2016-17. Europe accounted for 34 percent of exports followed by North America and Asia, with 28 percent and 25 percent respectively.
- The key export items included drive transmission & steering, engine components, Body/Chasis, Suspension & Braking etc.
- Imports of auto components increased by 17.8 percent to Rs.1,06,672 crore (USD 15.9 billion) in 2017-2018 from Rs. 90,571 crore (USD 13.5 billion) in 2016-2017. Asia accounted for 60 percent of imports followed by Europe and North America, with 30 percent and eight percent respectively.
- With increasing vehicle base in the country, the aftermarket in 2017-18 grew by 9.8 percent to Rs 61,601 crore (USD 9.2 billion) from Rs.56, 096 (USD 8.4 billion) in the previous fiscal.
“The dynamics of the automotive market is undergoing a significant transformation as the industry strives to become compliant with various regulations related to emissions, safety and environment, including the transition from BSIV to BSVI. That apart, key trends such as vehicle connectivity, electrification of vehicles, shared mobility, Industry 4.0 among others are also redefining mobility. To support the changing customer needs and to stay relevant, the auto component sector needs to be encouraged with supportive government policies. One of the key demands of the industry has been a uniform 18% GST rate across the auto component sector; currently, 60 per cent of the auto components attract 18 per cent GST rate, while the rest 40 per cent, the majority of which are two-wheelers and tractor components, attract 28 per cent. The latter high rate has led to flourishing grey operations in the aftermarket,” said Nirmal Minda, President, ACMA.