Indian Auto Component Industry Clocks Highest-Ever Turnover of Rs. 5.6 Lakh Crore, Grows 32.8 Percent in FY 2022-23

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“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 a sharper rise in imports that has translated into a trade deficit this year.” - Sunjay Kapur, President, ACMA & Chairman, Sona Comstar

August 2023 : Automotive Component Manufacturers Association of India (ACMA), the apex body representing India’s Auto Component manufacturing industry has recently announced the findings of its Industry Performance Review for the fiscal year 2022-23. The turnover of the automotive component industry stood at Rs. 5.60 lakh crore (US$ 69.7 billion) for the period of April 2022 to March 2023, registering a growth of 32.8 percent over the previous year.

Commenting on the performance of the auto component industry, Vinnie Mehta, Director General, ACMA said, “On back of significant vehicle sales in the country, a robust aftermarket and steady exports, the auto component industry demonstrated its best ever performance in FY23. The component industry sized-up to Rs. 5.60 lakh crore (US$ 69.7 billion) registering 32.8 percent growth, thus outpacing its highest ever turnover of Rs. 4.20 lakh crore in FY21-22. Exports grew by 5.2 percent to Rs. 1.61 lakh crore (US$ 20.1 billion) while imports grew by 10.9 percent to Rs. 1.63 lakh crore (US$ 20.3 billion). The Aftermarket, estimated at Rs. 85,333 crores also witnessed a steady growth of 15 percent. Component sales to OEMs in the domestic market grew by 39.5 percent to Rs. 4.76 lakh crore.”

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 a sharper rise in imports that has translated into a trade deficit this year.”

Elaborating on the mood of the industry and outlook for the near future, Mr. Kapur mentioned, “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 the domestic aftermarket continue to be robust.”

Key findings of the ACMA Annual Industry Performance Review for 2022-23:

Sales to OEMs: Auto Component sales to OEMs, in the domestic market, at Rs. 4.76 lakh crore (US$ 59.3 billion) grew 39.5 percent compared to the previous year. Consumption of increased value-added components and shift in market preference towards larger and more powerful vehicles contributed to the increased turnover of the auto-components sector.

Exports: Exports of auto components witnessed growth of 5.2 percent to Rs. 1.61 lakh crore (US$ 20.1 billion) in 2022-23 in contrast to Rs. 1.41 lakh crore (US$ 19.0 billion) in 2021-22. North America accounting for 32 percent of exports, saw a growth of 8 percent. Europe accounting for 31 percent and Asia for 26 percent grew 3 percent and 4 percent respectively.

The key export items included drive transmission and steering, engine components, body/chassis, suspension and braking etc.

Imports: Traction in the domestic market also reflected on imports of components into India. Component imports grew by 10.9 percent in 2022-23 to Rs. 1.63 lakh crore (US$ 20.3 billion) from Rs. 1.36 lakh crore (US$ 18.3 billion) in 2021-22. Asia accounted for 66 percent of imports followed by Europe and North America at 26 percent and 6 percent respectively. Imports from Asia grew 12 percent, while those from Europe by 6 percent and from North America by 23 percent.

Aftermarket: Increased movement of vehicles post-pandemic and surge in demand for used vehicles led to buoyancy in the aftermarket across all segments. The turnover of the aftermarket in FY 2022-23 stood at Rs. 85,333 crore (US$ 10.6 billion) compared to Rs. 74,203 crore (US$ 10.0 billion) in the previous year.

Notes:
1. Turnover data represents the entire supplies from the auto component industry (ACMA members and non-members) to the on-road and off-road vehicle manufacturers and the aftermarket in India as well as exports. This also includes component supplies captive to the OEMs and by the unorganized and smaller players. EV-Component sales to domestic EV-OEMs are also captured in supply to OEMs, this however does not include batteries.

2. Percentage Growth figures of total turnover of the auto component industry, sales to OEMs and aftermarket are in Rupee-terms while those of exports and imports are in Dollar-terms.

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