ACMA-McKinsey Report, Auto News, ET Auto

The study identified three areas that could help the auto parts industry adapt to emerging technological changes.

New Delhi: The $56.5 billion crore auto components industry sees an opportunity of about $135 billion by 2030, driven by continuous improvement and global expansion of the internal combustion engine (ICE ) associated with innovations in emerging technologies, according to a joint study by ACMA and McKinsey.

The study identified three areas that could help the auto parts industry adapt to emerging technological changes.

According to the report, continuous improvement and expansion of traditional ICE gaming in India outlines an opportunity of $35-45 billion by 2030. The study noted expanding opportunities in the automotive market like vendors of two and three wheels (in the face of early electrification) in segments which will gradually become electrified.

“Seize opportunities in adjacent automotive-type sectors, e.g., construction and mining equipment, rail/metro rolling stock, defense sector, etc. – all of which are growing and have a important market,” the report added.

The study estimates that sales of new electric two-wheelers and electric three-wheelers could reach 50% and 70% respectively by 2030. “ICE will continue to dominate India’s PV and HCV landscape, with more electrification are expected to account for 10% to 15% and 5% to 10% of new vehicle sales, respectively, by 2030,” the report said.

    The study estimates that sales of new electric two-wheelers and three-wheelers could reach 50% and 70% respectively by 2030.
The study estimates that sales of new electric two-wheelers and three-wheelers could reach 50% and 70% respectively by 2030.

Second, the report estimates that a global expansion into current ICE categories offers a $35-50 billion opportunity by 2030. Auto parts suppliers are expected to increase their exports through changing supply chains, as companies seek greater resilience by diversifying beyond traditional geographies.

Indian companies could seize opportunities in areas where India has traditional advantages and where exports are growing faster than competing suppliers from other geographies. These include categories such as forgings, castings, gearbox parts, suspension parts, axles, rims, he added.

    Indian companies could seize opportunities in areas where India has traditional advantages and where exports are growing faster than competing suppliers from other geographies.
Indian companies could seize opportunities in areas where India has traditional advantages and where exports are growing faster than competing suppliers from other geographies.

With faster penetration of electric vehicles, the report notes that the US and European markets will likely lose economies of scale to locally manufacture traditional component categories (forgings, castings, etc.) due to low demand volumes. and great variety.

“Make the most of the opportunity to rebalance global component manufacturing through electrification. India-based players could serve these markets, leveraging the advantage of lower cost labor “, he pointed out.

Finally, innovation in new opportunities and a global game represents a $25-40 billion opportunity by 2030. According to the report, automotive components players are expected to occupy emerging white spaces in electric vehicle categories, for example, battery cell supply chain, battery manufacturing. , electric motor supply chain, electric/reducing axle, electrics and electronics for electric vehicles and charging infrastructure.

“Grow into downstream service use cases and their provision, especially connectivity, where India has advantages to play a global role – software capabilities, application engineering capabilities and cost base weaker,” the report said.

According to initial estimates, the report also mentioned that a transition to electric vehicles could have an impact of up to 50% on the components of the ICE nomenclature. This could disrupt the portfolio of incumbents in traditional ICE component categories.

    According to initial estimates, the report also mentioned that a transition to electric vehicles could have an impact of up to 50% on the components of the ICE nomenclature.
According to initial estimates, the report also mentioned that a transition to electric vehicles could have an impact of up to 50% on the components of the ICE nomenclature.

This disruption could also be an opportunity – creating multiple white spaces for companies to meet new EV BOM needs and generate pathways to serve markets outside of India in ICE and EV component categories. These will represent new or expanded pools of value, which players can capture by pivoting and branching out with agility, the report points out.

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The Wall Street Journal, citing CEO Yoshihige Nomura, later reported that Honda was considering going public with the electric motorcycle unit.

The shift globally includes a family of electrified vehicle (xEV) technologies that consists of SHEV (Powerful Hybrid Electric Vehicle), FCEV (Fuel Cell Electric Vehicle), BEV (Battery Electric Vehicle) and PHEV ( plug-in hybrid electric vehicle).

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