India's Auto Component Industry Sees 9.8% Growth in FY24, Reaches USD 74.1 Billion

New Delhi, Jul 25 (KNN) In a significant development for India's automotive sector, the automobile components industry has reported substantial growth for the financial year 2023-24.

According to the Industry Performance Review released by the Automotive Component Manufacturers Association of India (ACMA), the industry's turnover increased by 9.8 per cent, reaching USD 74.1 billion (Rs 6.14 lakh crore), up from USD 69.7 billion (Rs 5.59 lakh crore) in the previous fiscal year.

The growth was primarily driven by increased vehicle sales and higher value addition from the component sector. Shradha Suri Marwah, President of ACMA and CMD of Subros, highlighted this point, stating, "It is pertinent to note that apart from increase in vehicle production, higher value addition from the component sector has led to growth in the auto components sector", reported moneycontrol.

Component supply to Original Equipment Manufacturers (OEMs) in the domestic market grew by 8.9 per cent, reaching USD 62.4 billion (Rs 5.18 lakh crore).

The electric vehicle manufacturing industry accounted for 6 per cent of the total component production in the country, indicating a growing shift towards sustainable mobility.

Despite geopolitical challenges and increased logistics costs, exports grew by 5.5 per cent to USD 21.2 billion (Rs 175,960 crore). Import growth was comparatively lower at 3 per cent, reaching USD 20.9 billion (Rs 173,470 crore). The industry achieved a trade surplus of USD 300 million, reflecting the sector's increasing focus on localisation.

North America remained the largest export destination, accounting for 32 percent of exports with a growth of 4.5 per cent. Europe, accounting for 33 per cent of exports, saw a significant growth of 12 percent. Asia, representing 24 percent of exports, remained flat.

While the industry has reached pre-pandemic performance levels in most segments during FY24, Marwah noted that the first quarter of FY25 witnessed slower vehicle sales, particularly in passenger vehicles and commercial vehicles.

However, the industry remains optimistic about its prospects for FY25, citing strong macro-economic indicators, conducive government policies, and projected GDP growth of over 7 per cent.

(KNN Bureau)