Automotive Industry Today
India Auto Parts Market to Hit USD 115.54B by 2035 at 5.02% CAGR
The India Auto Parts Market is seeing dynamic growth, fueled by rising demand for vehicles, evolving regulatory norms, and a shift toward more advanced, safety-oriented, and electric components. The burgeoning middle class, increasing vehicle ownership, and a supportive policy environment are driving the aftermarket and OEM auto parts sectors alike. As India’s automotive landscape modernizes, the auto parts market is becoming more diversified, technologically sophisticated, and regionally expansive.
India Auto Parts Market Size was estimated at 67.41 USD Billion in 2024. The India Auto Parts industry is projected to grow from 70.8 USD Billion in 2025 to 115.54 USD Billion by 2035, exhibiting a compound annual growth rate (CAGR) of 5.02 during the forecast period 2025 - 2035.
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Market Drivers
One of the most significant drivers behind the India auto parts market is the rapid increase in vehicle ownership. With income levels rising and urbanization accelerating, more Indians are buying cars, two-wheelers, and commercial vehicles. This growing fleet directly translates into higher demand for spare parts, replacement components, and maintenance services.
Another key driver is the government’s push for electric vehicles (EVs). India is strongly encouraging the adoption of EVs through subsidies, tax incentives, and infrastructure development. As EV penetration rises, demand for specialized auto parts — such as battery systems, power electronics, EV-specific braking systems, and regenerative components — is increasing. This shift is creating entirely new segments within the auto parts space.
Stringent safety and emission regulations are also boosting growth. The Indian government has been steadily enforcing stricter emissions norms, and crash-safety standards are tightening. These regulatory changes are forcing automakers to use higher-quality, more reliable parts, which boosts demand for advanced, certified components.
Increasing policy support and infrastructure investments add to market momentum. Road-building programs, improved transport networks, and public transport expansion create more opportunities for both vehicle sales and service networks. Further, as manufacturers expand their facilities within India to capture domestic and export demand, the demand for parts and components from domestic suppliers grows in tandem.
The aftermarket segment is also flourishing. As the cost of vehicle ownership rises, many consumers are turning to the aftermarket for cost-effective maintenance and repair options. This has opened up a robust market for spare parts, accessories, and performance-enhancing components. The rising number of independent service stations, coupled with stronger supply chains, is making aftermarket parts more accessible across cities and smaller towns.
Technology Advancements
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Technological innovation is reshaping India’s auto parts market in multiple ways. One of the most important trends is the increasing integration of electronic and smart systems. Components such as advanced driver-assistance systems (ADAS), electronic control units (ECUs), and smart sensors are being indigenously developed and manufactured. These systems require high-precision parts, microcontrollers, and special electronic components to ensure safety and reliability.
A second key advancement is in lightweight materials and composites. To meet the demands of fuel efficiency and lower emissions, OEMs are using lighter, stronger materials in auto parts — including aluminum alloys, carbon-fiber-reinforced plastics, and advanced polymers. These materials allow vehicles to be more fuel-efficient without compromising on strength or durability.
Third, additive manufacturing (3D printing) is gaining traction in the auto parts space. Suppliers are using 3D printing to prototype, produce spare parts, and even manufacture complex components that would be difficult or expensive to produce using conventional methods. This technology helps reduce lead times, lower costs, and improve customization options for service networks.
Fourth, electrification-related parts are rapidly growing. As the EV market expands, parts like battery packs, inverters, on-board chargers, DC-DC converters, and regenerative braking systems are becoming mainstream. Indian suppliers are scaling up to produce these components locally, reducing dependency on imports and lowering costs.
Fifth, IoT and connectivity are becoming embedded in auto parts. From telematics devices to connected sensors that monitor part health in real-time, the aftermarket is seeing a wave of intelligent parts. This is especially useful for fleet operators, who can track the performance of their vehicle parts, predict maintenance needs, and reduce downtime.
Finally, sustainable and green technologies are emerging. Manufacturers are developing eco-friendly parts made from recycled materials or using processes with lower environmental impact. Technologies like water-based coatings, bio-based plastics, and reduced-waste production techniques are gaining popularity in response to regulatory pressure and growing environmental awareness.
Regional Insights
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Northern India
In Northern India, the auto parts market is strongly influenced by both OEM production hubs and a thriving aftermarket ecosystem. The region has several manufacturing centers, and its proximity to major vehicle assembly plants drives strong demand. There is also a growing network of regional service workshops that cater to both personal and commercial vehicles, which fuels part sales in the aftermarket.
Western India
Western India — especially Maharashtra and Gujarat — is a powerhouse for automotive production and auto parts manufacturing. Many Tier-1 and Tier-2 suppliers are based here, serving both domestic and export markets. The region’s infrastructure advantages, port access, and industrial clusters make it a hotspot for auto parts investment. Additionally, Western India sees robust demand for aftermarket components due to the high rate of vehicle sales and replacement cycles.
Southern India
Southern India is emerging as a key region for technology-driven auto parts. States like Tamil Nadu and Karnataka host several major automotive and EV-related manufacturing units. With a strong pool of engineering talent, established suppliers, and R&D centers, this region is leading in producing advanced components such as electronic modules, EV powertrain parts, and lightweight material-based assemblies.
Eastern India
In Eastern India, the aftermarket is growing rapidly as vehicle ownership increases. While OEM manufacturing presence is comparatively smaller than in other regions, there is a significant opportunity for independent suppliers to cater to replacement parts and service networks. The local aftermarket is strengthening, driven by rising urbanization, greater vehicle penetration, and increasing repair shop density.
Central India
Central India, including states like Madhya Pradesh and Chhattisgarh, is witnessing gradual but steady auto parts demand. Infrastructure development and increasing industrial activity are boosting demand for commercial vehicles, and in turn, auto parts. The aftermarket here is still evolving, but growth prospects are strong as service infrastructure expands.
Outlook
The India auto parts market is poised for robust growth in the years ahead, driven by rising vehicle ownership, a shift toward electric mobility, and more stringent safety and emission norms. Technological advancements — including smart electronics, lightweight materials, additive manufacturing, and connectivity — are reshaping how components are designed, manufactured, and serviced. Geographically, all regions of India present strong opportunities: the North and West for manufacturing, the South for innovation, and the East and Central regions for aftermarket expansion. As the country accelerates its journey toward a more modern, efficient, and sustainable automobile ecosystem, its auto parts industry will play a central and transformative role.
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