Auto component makers in India are gearing up for change. They have lined up expansion and investment projects, diversifying, derisking portfolios, and entering joint ventures to ride into a brave new world, according to The Economic Times.
As the component industry looks to invest $2-3 billion in the coming two years, most ancillary makers state electric vehicle parts are contributing to their order books.
Companies to source EV components from India
Multinational companies like Stellantis look to source more components from India to back their electric vehicle program. On his latest visit to India, Stellantis CEO Carlos Tavares said they’re open to discussions with component makers and are ready to localize work on EVs, considering India’s low-cost supplier base.
Other companies, such as Daimler and Renault, might also look at sourcing more EV parts in the country.
Shifting to electric mobility by 2030
This follows an obvious switch to electric mobility in two- and three-wheeler industries. Nearly the entire three-wheeler industry and almost 80% of the two-wheeler industry could become electric by 2030.
The passenger vehicle’s (PV) change rate and commercial vehicle (CV) sectors are slower — only 10-15% of PVs and around 10% of CVs are anticipated to be electric by 2030.
EV revenues
In addition, automotive systems and parts manufacturer Sona Comstar said its revenue share from BEVs increased from 21% in the first half of 2022 to 25% in the first half of 2023.
We continue to build on our EV order book and now have 37 EV programmes across 23 customers.
Vivek Singh, MD, Sona Comstar
Earlier, propulsion motors and controllers were used in electric two- and three-wheelers. At present, these will also be used in electric light commercial vehicles (LCVs), which would see their revenue from EVs growing to 45% in 2026, added Singh.
Companies like Uno Minda predicted the trend and began working on EV-specific products such as chargers, DC converters, charging cables, vehicle alert systems, and smart plugs.
To hit the market faster, we entered into a JV with German manufacturer Friwo which helped add board chargers, battery management systems, motor controllers and battery packs to our product portfolio.
Nirmal K Minda, chairman and MD, Uno Minda
Over the month of November, it also put traction motors for electric 2W/3W by going into a JV with Buehler Motor of Germany. Aside from investing 3% of its revenue in R&D, Uno Minda announced a capital expenditure of `390 crore ($4.7 million) in its JV with Friwo and Rs 100 crore ($1.2 million) with Buehler Motor.
Meanwhile, Flash Electronics is on a path to exceed `1,200 crores ($145.6 million) of revenue next year. Electric vehicles contribute 8% to this.
We expect to double our turnover by 2025 and EV-related products to be the main growth driver.
Sanjeev Vasdev, MD, Flash
Electric vehicle investments
Notably, it plans to invest `150 crore ($1.8 million) for EV products in two greenfield manufacturing plants in Pune. Additionally, it has tied up with the French company Enerstone and Poland-based electromobility component designer Elimen Group to build an advanced battery management system that protects lithium-ion cells from aging.
We are engaged with various customers to keep our business strategies aligned with their future plans. Our strategy is two-pronged. One, to disrupt the market with advanced versions of our legacy solutions like high-voltage wiring harness, digital clusters and keyless locking systems. Two, to map new product requirements in EV at the R&D facility in Pune.
Aakash Minda, ED, Minda Corporation
Recently, Minda partnered with EVQPoint, an EV solutions provider from Bengaluru.
Furthermore, the auto electrical company Lucas TVS s setting up three production lines to make hub motors and mid-drive motors for electric two-wheelers and scaling up production to 1 million units.
KSV Babu, business head of e-mobility Lucas TVS, noted they’re also dabbling in components for electric passenger cars. While it is still a small part of the electric pie, it’s seeing plenty of traction.
Meanwhile, Automotive Component Manufacturers Association (ACMA) conducted some tech shows for leading original equipment manufacturers (OEMs) in the EV space, such as Hyundai, Ashok Leyland, Volvo Eicher, Hero MotoCorp, and Tata Motors, to allow domestic components manufacturers to ramp up and become competitive globally, notes Vinnie Mehta director-general, ACMA.
Notably, a study by ACMA and the Society of Indian Automobile Manufacturers identified an opportunity to the tune of $20 billion in the coming five years for electric components’ localization.
Moreover, multinationals are ramping up their exposure to electric components. The Continental’s powertrain business, Vitesco Technologies, signed agreements with auto OEMs to provide integrated electric axle drive systems for cars and LCVs.
It’s also reducing its internal combustion engine (ICE) vehicle exposure.
Our partnership with battery specialist Varta aims to develop new technologies and products for electric mobility and is working on a replaceable 48-volt battery for electric two-wheelers.
Prashanth Doreswamy, president & CEO of Continental India
Policies like the Faster Adoption & Manufacturing of Electric Vehicles scheme and production-linked incentive schemes drive this shift. It can make the country an attractive, alternative high-end auto components source worldwide in the upcoming five years.
