Mumbai, Oct 4 (IANS): Enabled by manufacturing, innovation and technology leadership, India has the potential to become a $1 trillion export-led automotive industry by 2035, a new report showed on Wednesday.
It has the potential to unlock $400 billion of incremental revenues by 2035 (over and above $600 billion as-is-trajectory) by focusing on exports, innovation and technology transforming India into a global automotive hub, according to the report by management consulting firm Arthur D. Little.
Indian players across the value chain need to upgrade their capabilities and position India as a reliable and competitive hub for the manufacturing of vehicles for global markets, including developed countries, the report added.
“We believe that global players could deepen their India footprint further for manufacturing, sourcing, software, and Indian players could become global champions with significant international presence as the global industry gets disrupted by megatrends,” said Dr Andreas Schlosser, Partner and Global Automotive Leader.
The global automotive ER&D and software market is expected to grow three-fold by 2030 to $400+ billion.
India can leverage its position as the software hub of the world and offshore destination of choice for ER&D, said the report.
However, industry players must upgrade their offerings to include solutions relevant for emerging trends such as zonal architecture design, digital cockpit, ADAS, etc.
“India's strength in automotive software and ER&D can thrive by offering solutions aligned with emerging trends like zonal architecture and Advanced Driver Assistance Systems (ADAS). India has the potential to be an automotive innovation leader, with a thriving well-funded startup ecosystem,” said Barnik Chitran Maitra, Managing Partner, Arthur D. Little, India & South Asia.
The electric vehicle major is planning to source automobile parts worth up to $1.9 billion this year from India, Commerce Minister Piyush Goyal said last month.
The imports will be around double as compared to auto parts worth $1 billion imported by Tesla from India last year, Goyal said while addressing the annual convention of Automotive Component Manufacturers Association (ACMA).
The minister said that in 2022, Tesla had already bought $1 billion worth of components from India and this year their target is $1.7-$1.9 billion.
According to the report,Indian players also need to invest in sustainable practices, such as use of lightweight materials, secondary aluminium, green steel, recycling of Lithium batteries.