In a move that signals a seismic shift in global trade dynamics, the European Union and India today concluded negotiations for a historic and ‘commercially significant’ Free Trade Agreement (FTA). As the largest deal ever brokered by either side, the pact creates a massive free trade zone encompassing 2 billion people and the world's second and fourth largest economies.

While the agreement spans sectors from agriculture to pharmaceuticals, it is the automotive industry that stands as the centrepiece of this industrial realignment.

Cracking the 110% tariff wall

For decades, European automakers have struggled against India’s formidable trade barriers. Under the new agreement, these hurdles are set to crumble. India has committed to a radical reduction in car tariffs, which currently sit at a staggering 110 percent. According to the official release, these duties will be gradually slashed to as low as 10 percent.

Furthermore, the deal provides a massive boost to the automotive supply chain. Tariffs on car parts – a critical sector for European manufacturers – will be fully abolished within a 5-to-10-year window. This move is expected to integrate Indian and European manufacturing hubs more closely than ever before.

European Commission President Ursula von der Leyen hailed the deal as a milestone for rules-based cooperation. "The EU and India make history today. We have sent a signal to the world that rules-based cooperation still delivers great outcomes," she said.

With a population of 1.45 billion and a GDP of EUR 3.4 trillion, India is currently the world’s fastest-growing large economy. This FTA grants European carmakers and industrial firms a ‘privileged access’ that no other Indian trading partner currently enjoys.

Beyond the finished vehicles, the deal addresses the broader industrial ecosystem:

• Machinery & Chemicals: Tariffs of up to 44 percent on machinery and 22 percent on chemicals will be mostly eliminated.
• SME Support: Dedicated contact points will be established to help smaller European component manufacturers navigate the Indian market.
• Intellectual Property: The agreement guarantees high-level protection for designs and trade secrets, providing the legal certainty required for high-tech automotive transfers and R&D investment.

The deal is not merely about volume; it is about the future of mobility. A dedicated chapter on trade and sustainable development focuses on climate change and environmental protection.

To support India’s transition toward sustainable industrialisation – a move critical for the electric vehicle (EV) sector – the EU intends to provide EUR 500 million in support over the next two years. Additionally, a new EU-India platform for climate action cooperation is slated to launch in early 2026, likely serving as a catalyst for joint ventures in green hydrogen and battery technology.

The EU expects the deal to double its goods exports to India by 2032, saving European businesses approximately EUR 4 billion per year in duties.

The path to implementation now moves to the legal and political stage. The negotiated texts will undergo legal revision and translation before being presented to the European Council and the European Parliament for consent. On the Indian side, the agreement will move toward formal ratification.

After nearly two decades of stop-and-start negotiations – beginning in 2007 and relaunching in 2022 – the road is finally clear for a new era of Euro-Indian industrial synergy.

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Japanese tier 1 supplier Panasonic Automotive Systems Co., has announced it will change its corporate name and brand to Mobitera Inc., effective 1 April 2027. The rebranding follows a strategic partnership formed in December 2024 with the Apollo Group, aimed at strengthening software development and optimising the company's business portfolio.

The transition to Mobitera represents the company's focus on the evolution of the in-vehicle cockpit space. The new name combines ‘mobility’ with the Latin ‘iter’ (path) and the Japanese ‘terasu’ (to illuminate).

The organisation is pivoting to meet market demands by prioritising software capabilities alongside its hardware legacy. The company’s mission has been defined as creating a sustainable mobility society, supported by a vision titled ‘Joy in Motion.’

The new logo features a central ‘I’ intended to symbolise a focus on individuals. The corporate colour, ‘Mobitera Blue-Green,’ has been selected to represent the harmonisation of society and the environment.

Masashi Nagayasu, Chief Executive Officer, Panasonic Automotive Systems, said, “Mobitera reflects our vision to power the future of mobility with our high-quality technologies that elevate and enrich the human experience. As we evolve our organisation to meet the needs of today’s rapidly changing market, we are committed to staying true to the core values that have long defined who we are.”

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Sunil Koparkar, Managing Director, IAC India, outlines the company’s strategy to reduce customer concentration, expand exports and leverage group synergies following its integration with the Lumax Group.

As India’s automotive interior market evolves towards premiumisation, localisation and faster product cycles, IAC India, part of the Lumax Group, is repositioning itself beyond a single-customer dependency model – without diluting its core partnerships.

IAC India continues to derive a significant share of its revenue from Mahindra’s passenger vehicle business. While the concentration remains high, Koparkar is clear that diversification will be driven through growth rather than dilution.

“Mahindra will always be our primary customer. We have a very strong strategic partnership. But we are also working on expanding with other OEMs and in the commercial vehicle space. Our goal remains a 20 percent CAGR,” he says.

For FY2025, IAC India USD 140 million in revenue, and is targeting a 20 percent growth in FY2026. The company counts Mahindra as its primary customer with almost 78 percent of its business coming from them, while Maruti Suzuki India (12%), Volvo Eicher Commercial Vehicles (5%), Skoda-Volkswagen (3%) and Stellantis (1%) contribute towards the remaining business.

What’s more, responding to the company’s expansion plans, Koparkar revealed, that IAC Group, in addition to introducing new products, is also in talks with new-age players who have just entered Indian market (and also planning too) for supplying products.

Currently, passenger vehicles account for roughly 90 percent of the business, with commercial vehicles forming the balance. Value-wise, Koparkar expects CV contribution to rise, even if percentage splits remain broadly similar due to the rapid growth of PV volumes.

Responding to a query on the potential growth from the CV segment, Koparkar said, “There is clear potential in CV interiors. As the CV market moves towards more comfortable cabins — with features like airbags, HVAC and infotainment — the opportunity for interior suppliers increases. Through Volvo Eicher, we have already helped drive that trend in India.”

When asked about the company’s expansion plans, Koparkar also stated that IAC Group is open to expanding to new regions as it aims to operate closer to its customers. One of the potential new projects for the company could very well be Chennai, as the company is in early talks with a new CV customer as well as VinFast.

Engineering as a Standalone Growth Lever

A key pillar of IAC India’s strategy is its expanding engineering capability. The company has been scaling up its R&D and product development team and increasingly positioning engineering services as a distinct revenue stream.

The company at present, employs over 300 engineers in India, which it aims to scale it upto 400-plus by next year and 500-plus in the coming few years.

Historically, the Indian Engineering Centre supported the global IAC Group. “We were primarily the IAC Group engineering development centre. We will continue to provide those services. But now, besides global support, we are also offering engineering services to local OEMs,” Koparkar explains.

These services span studio collaboration, basic product design, CAE analysis and prototype development. In some cases, this can potentially evolve into full-scale supply programmes.

Importantly, innovation is now being formalised locally. “This year alone, we are in the process of filing about 30 patents,” he says. Earlier, intellectual property was subsumed under the global entity; now, filings are being initiated in India.

R&D investment remains aligned with group benchmarks at around 1.5–2 percent of revenue.

Exports: Measured Ambition

In terms of export potential, it currently contributes less than 5 percent towards the revenue, primarily through smaller kinematic parts. Direct exposure to the US market is negligible.

“Tariff-related uncertainty does not affect us because we do not export to the US,” Koparkar says. “Logistically, it does not make sense to ship our large interior parts there.”

Europe remains the primary export target. “The opportunity lies in leveraging our design capabilities and local development strengths. If logistics can be managed efficiently, there is room to grow.”

He also sees the Lumax Group’s aftermarket division as a future vehicle for export expansion.

Localisation and Supply Chain Resilience

On the localisation front, IAC India has made significant progress. “Last year was the first time we were able to localise over 99 percent of our tooling and development in India,” Koparkar states. Machinery on shop floors is largely localised, with only certain raw materials still imported.

The semiconductor crisis, he adds, had minimal direct impact. “We do not source electronics for our products — that is handled by the customer. However, from a development perspective, we are evaluating secondary substitutes for imported components, so we are prepared in case of disruptions.”

Premiumisation, Sustainability and AI

Premiumisation is currently the dominant interior trend. “Customers are moving away from basic plastics to more premium-feel interiors. Electronification is a big driver,” Koparkar says.

Sustainability, however, remains nascent in India. “There is no specific push for sustainable materials yet. What OEMs are looking for is lightweighting to meet upcoming CAFE norms. If a sustainable material delivers significant weight reduction, then it becomes serious.”

He points to jute, coir and bamboo fibres as potential alternatives but stresses that ecosystem-level collaboration is essential. “Unless a circular economy develops around us, sustainable materials will struggle to scale.”

On automation, operations across IAC’s six plants are roughly a 50:50 mix of automated and manual processes, depending on volume justification. Cobots and semi-automation are used where full automation does not offer viable returns.

AI, meanwhile, is expected to influence design more than manufacturing. “We see AI helping us accumulate design learnings and reduce design cycle times. Its impact will be more visible in engineering services than on the shop floor.”

Faster Development Cycles

Product life cycles are shrinking rapidly. “It used to take five years to develop a car,” Koparkar reflects. “With the XUV700, we worked with the customer to shrink that to 42 months. EVs are being developed even faster.”

As development timelines compress and interiors become more technology-intensive, IAC India is betting on engineering depth, localisation strength and group synergies to sustain its 20 percent growth ambition – while steadily broadening its customer and geographic footprint

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Rosmerta Technologies has launched a comic book titled ‘The Curious Bunch’ at the 3rd Edition of the CII National Conclave on Road Safety. The publication is designed to introduce road safety awareness to children.

The initiative aligns with the Government of India’s ‘4E’ strategy for road safety, which focuses on Engineering, Education, Enforcement and Emergency Care. The comic book aims to address the 168,000 road fatalities reported in India in 2022 by fostering safe habits at a school level.

The comic book uses illustrations to present road scenarios, including pedestrian conduct, school bus safety, traffic signals & the use of helmets, seatbelts and child restraint systems. By educating children, the company intends to influence the behaviour of parents and the wider community.

Rosmerta, a provider of mobility solutions, currently operates technology systems for automated driving tests and AI-based monitoring. The launch of ‘The Curious Bunch’ marks an expansion of its activities into the education pillar of the national safety framework.

Dr Rajesh Mohan, DCP, Gurugram Traffic, said, “When we educate children and instil strong moral and ethical values, the impact travels far beyond the classroom. Children naturally share what they learn. They question, they explain, and they influence conversations at home. In many ways, they become powerful advocates, encouraging their parents to be more aware, more responsible, and more engaged. Over time, this awareness translates into action, because parents are also drivers, commuters, and decision-makers on the road.”

Ravi Krishnamoorthi, Group President, Rosmerta Technologies, said, “Every road accident statistic hides a parent’s anxiety. In 2022 alone, India reported over 168,000 road accident fatalities, according to government data. Road safety is not merely about compliance; it is about compassion and collective responsibility. When a child understands why a red light matters or why a helmet can save a life, they don’t just learn a rule - they become ambassadors of safety within their families and communities. Through ‘The Curious Bunch’, we aim to nurture this awareness early, because the habits we shape in children today will define the safety culture of our nation tomorrow.”

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Maruti Suzuki India, in partnership with the Transport Department of Tamil Nadu, has announced the commissioning of seven Automated Driving Test Tracks (ADTTs) in the state. The facilities were inaugurated by the Chief Minister of Tamil Nadu, M K Stalin.

The tracks are located at Regional Transport Offices (RTOs) in Coimbatore (Central), Tiruvannamalai, Krishnagiri, Madurai (North), Sivagangai, Dindigul, and Tiruchirappalli (West). These sites form part of a Memorandum of Agreement to automate ten tracks across the state, with the remaining three at Tirunelveli, Tuticorin and Marthandam scheduled for operation shortly.

The ADTTs are designed to evaluate applicants for two-wheeler and Light Motor Vehicle (LMV) licences. The system removes human intervention from the evaluation process to ensure objective testing according to the Central Motor Vehicle Rules (CMVR).

Key technical components include:

• Video Analytics: High-definition cameras to monitor vehicle movement and path adherence.
• Sensors: Radio Frequency Identification (RFID) and Harnessing AutoMobiles for Safety (HAMS) technology.
• Identification: Face-recognition systems to verify candidate identity.
• Results: Integrated IT systems that generate test results automatically based on real-time data.

The carmaker has commissioned 56 ADTTs across eight states, including Uttar Pradesh, Delhi, and Bihar. Following the completion of agreements with Rajasthan and Andhra Pradesh, the company’s footprint is expected to reach 81 tracks nationwide.

Rahul Bharti, Senior Executive Officer, Corporate Affairs, Maruti Suzuki India, said, “As part of Maruti Suzuki’s road safety initiatives implemented across multiple states, we are partnering with the Government of Tamil Nadu to strengthen the driver licensing evaluation process through the deployment of 10 Automated Driving Test Tracks (ADTTs). Equipped with high-definition cameras and advanced analytics, these ADTTs enable a comprehensive, efficient, and transparent assessment process. It eliminates any human bias and ensures that only skilled drivers are awarded a license.”

“According to data shared by the Ministry of Road Transport & Highways, India witnessed 1.77 lakh road accident deaths in 2024. Promoting disciplined driving practices and ensuring rigorous driver evaluation are vital to prevent road accidents and augment road safety across the country,” he said.

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