Auto parts industry cautiously optimistic for growth in FY22

New Delhi: The auto component industry remains 'cautiously optimistic' for the growth of the industry in the current fiscal year despite concerns of another wave of the pandemic, industry body ACMA said on Tuesday.

The turnover of the automotive component industry stood at Rs 1.96 lakh crore ($26.6 billion) in April-September 2021, registering a growth of 65 per cent over the first half of the previous year. "Despite resurgence of demand for vehicles, supply-side issues of availability of semiconductors, increasing input costs, rising logistics costs and availability of containers, among others, continue to hamper recovery in the automotive sector," Automotive Component Manufacturers Association of India (ACMA) President Sunjay Kapur noted.

The auto component industry, against this backdrop, displayed remarkable resilience, he added. "Increased value-addition to meet regulatory compliance, fast recovery in external markets and traction in the domestic aftermarket have contributed to the growth of the sector in the first-half of FY 2021-22," Kapur said. Going forward, whilst the performance of the vehicle industry during the festive season has not been on expected lines, there are indications that the vehicle demand, in the coming months, will improve, he stated.

"This, together with the increased focus by the auto industry on deep-localisation and the recent announcements of PLI schemes by the Government on Advanced Chemistry Cell (ACC) Batteries and Auto & Auto Components will facilitate the creation of a state-of-the-art automotive value chain and developing India into an attractive alternative source of high-end auto components," Kapur said. He added that according to a recent survey of ACMA leadership, despite concerns of another wave of the pandemic, the industry is cautiously optimistic about the prospects of the Indian economy and the automotive sector for 2021-22.