After terming India’s import duty barriers high for some time, US President Donald Trump has expressed that 2 April 2025 will be remembered as the day the American industry was reborn as his government announced a broad new tariff policy that imposes at least a 10 percent duty on nearly all imports from certain countries. In the case of India, the policy speaks of 26 percent ‘discounted' reciprocal tariffs. The tariff on China, on the other hand, is 34 percent. 

Aimed at protecting American farmers and ranchers, according to Trump, the broad-based tariff policy is also being termed as ‘national emergency’ driven in view of the ongoing trade deficits, which hit a record USD 1.2 trillion in 2024.

The German auto industry has reacted to the US policy by stating that it 'will only create losers'. While the Asian stock markets have shrunk in response to the announcement, the Indian Ministry of Commerce is analysing the impact of the 26 percent ‘discounted’ tariff announcement. 
Mentioning in its statement that it understands the intent of the US administration to boost domestic manufacturing and address trade imbalances, the Indian auto components apex body ACMA (Automotive Component Manufacturers Association of India) has said that autos and auto parts as well as steel and aluminium articles are already subject to Section 232 tariffs at 25 percent announced earlier by the US President’s order on 26 March 2025. A detailed list of auto components that will be subject to 25 percent import tariff is awaited, it mentioned.

Shraddha Suri Marwah, President, ACMA and CMD, Subros Ltd, averred, “ACMA remains hopeful that the ongoing bilateral negotiations between the Indian and U.S. governments will lead to a balanced resolution that benefits both economies. We believe that the strong trade relationship between India and the United States, especially in the auto components sector, will encourage continued dialogue to mitigate the impacts of these measures. ACMA is committed to engaging with all stakeholders to ensure the long-term interests of the Indian auto component industry.”

Saurabh Agarwal, Partner and Automotive Tax Leader, EY India, observed, "With US automotive tariffs rising, India's electric vehicle sector has a prime opportunity to capture a larger share of the US market, especially in the budget car segment.” He drew attention to the fact that China's 2023 auto and component exports to the US stood at US$17.99 billion whereas India's were only US$2.1 billion in 2024, highlighting the potential for growth. “To accelerate this, the government should enhance the PLI scheme by including more auto components, opening it to new players, and extending it by two years,” he added. 

Mrunmayee Jogalekar, Auto and FMCG Research Analyst, Asit C Mehta Investment Interrmediates Ltd, expressed, “Certain sectors such as auto and auto ancillary, which are already subject to a separate 25 percent tariff announced in March are exempt to the levy of reciprocal tariffs. This means no additional tariffs will be imposed on this sector.”
Stating that other exempted segments include copper, pharmaceuticals, semiconductors, critical minerals and energy products, she informed,

“Since import duties apply to all trading partners, the extent of impact will vary across sectors and countries based on competitive advantages.” “For the Indian auto component industry, which derives around 30 percent of its revenue from exports, with 30 percent of that coming from the US, this could result in a potential hit on sales or profit margins,” she added. 

In FY2024, ACMA reported that India exported USS$ 6.79 billion worth of auto components to the US. It imported only USS 1.4 billion, resulting in a substantial trade surplus in India's favour. 

Against the backdrop of the broader tariff policy that speaks of a 26 percent duty of Indian exports to US, the discussion between Indian and the US regarding the bilateral trade agreement will assume importance as well as urgency. For US automotive companies to find their way to the Indian market despite their near cult status – the likes of Harley Davidson and Tesla – will only mean facing a competition that is stiffer than expected and a customer mindset that is far different from how it is in the US. 

Srikumar Krishnamurthy, Senior Vice-President & Co-Group Head, Corporate Ratings, ICRA, said, "The US Government has imposed a 25 percent tariff on passenger vehicles (sedans, sport utility vehicles, crossover utility vehicles, minivans and cargo vans) and light trucks (collectively referred to as automobiles), which come into effect from 3 April  2025. As the PV exports from India to the USA represent less than 1 percent of the total PV exports, the tariff imposition of the tariff does not have any material impact on the Automotive OEMs. The scenario is however different for auto components. On 12 March 2025, a 25 percent tariff was imposed on all aluminium and steel components being imported into the US. Subsequent to this, on 26 March 2025, a 25 percent tariff was imposed on other key auto parts as well (including engines, transmissions, powertrain components and key electrical parts except those under USMCA), with processes to expand tariffs on additional parts, if necessary. The effective date is pending but is expected to be no later than 3 May 2025. Auto components have not featured in the latest set of additional tariff announcements that has been made on 2 April 2025. India’s auto components exports accounted for around 29 percent of industry revenues in FY2024. Of this, about 27 percent went to the US. While the situation is evolving, the recent tariff related development and the consequent inflationary pressures and slowdown in demand in the US could have a negative impact on revenue and earnings for component exporters (in the affected product categories) over the next few months. Nevertheless, with higher tariffs being levied on other competing nations, this could also create long-term opportunities for the exporters. Exporters dependent on the US are also trying to diversify their revenue base across other geographies (including Asia). Measures to improve value addition, diversification into non-auto segments and cost-optimisation strategies are also being worked upon to reduce the potential impact on margins.

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German automotive major the BMW Group has received the ‘Global New Energy Vehicle Innovative Technology’ award at the 2026 World New Energy Vehicle Congress (WNEVC) in China.

The company was recognised for its sixth-generation (Gen6) high-voltage battery system, which uses round battery cells with a high-nickel cathode. The BMW Group was the sole non-Chinese automotive manufacturer to receive a technology award at the event.

The Gen6 battery system serves as a component of the company's upcoming ‘Neue Klasse’ vehicle platform, which will be integrated across its electric vehicle lineup. In developing the sixth-generation eDrive technology, the BMW Group filed over 500 patent applications. The battery architecture utilises an 800-volt system, bidirectional charging capability and a cell-to-pack design that integrates cylindrical cells directly into the battery pack without intermediate module structures.

Jochen Goller, Member of the Board of Management, BMW AG responsible for Customer, Brands, Sales, said, “We are very proud to receive this international award for our Gen6 high-voltage battery. It confirms our long-term approach of combining technological innovation with the highest standards of quality and safety and genuine customer relevance. With the Neue Klasse, we are setting new benchmarks in this area.”

Thomas Engelhardt, Senior Vice-President Development High-Voltage Batteries, Charging at the BMW Group, said, “The Gen6 high-voltage battery represents a technological leap across all customer-relevant features. Its innovative, flat design with cylindrical cells paves the way for greater range and faster charging, while maintaining the highest level of safety. As a core technology of the Neue Klasse, it forms the foundation for fully-electric driving pleasure across the entire BMW portfolio.”

The battery system incorporates steel-housed round cells, multi-stage insulation and thermal management features. The energy management functions are directed by the ‘Energy Master’ unit, featuring hardware and software developed in-house by BMW to manage power distribution, vehicle electrical system supply and battery data processing. The Energy Master system provides compatibility with both 400-volt and 800-volt charging infrastructure and allows for the integration of alternative cell chemistries.

The presentation marks the fifth consecutive year and sixth time overall that the BMW Group has received recognition at the World New Energy Vehicle Congress, an annual industry conference bringing together automotive, academic and government representatives to discuss electric vehicle developments.

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Japanese automotive component supplier Toyoda Gosei Co has announced plans to establish a new manufacturing facility in the Bidkin Industrial Area in Maharashtra.

The plant will produce interior and exterior components, including bumpers and instrument panels, alongside safety systems such as airbags and steering wheels and functional components like plastic fuel filler pipes.

It will commence operations in the first half of 2029 to supply Japanese car manufacturers operating in the country, including Toyota Kirloskar Motor, which is constructing a vehicle plant in the same industrial zone.

The development represents Toyoda Gosei’s eighth location in India and will operate as a branch plant under its subsidiary, Toyoda Gosei South India.

The site covers approximately 78,400 square metres of land with a planned building area of 29,200 square metres. Toyoda Gosei plans an investment of approximately INR 5.758 billion (JPY 9.3 billion) for the project, with projected workforce numbers reaching around 570 employees by 2030.

The facility will incorporate equipment including electric injection moulding machines with automated mould-changing systems, a bumper painting booth, automated guided vehicles and rooftop solar panels.

Production processes will integrate Internet of Things technology, digital transformation systems, collaborative robots, and mechanical mechanisms derived from Karakuri design principles.

The expansion comes as product demand in India shifts from compact cars toward sport utility vehicles. Toyoda Gosei intends to utilise the new facility to expand its local development and manufacturing network across the region.

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Pune-headquartered automotive company Kinetic Engineering has announced an investment of approximately INR 570 million to support its capital expenditure requirements and expand its electric two-wheeler segment.

The company shared that it intends to deploy INR 170 million toward CAPEX, while INR 400 million will be directed toward electric vehicle manufacturing and distribution. The capital injection is being executed through the final tranche conversion of 4,451,000 warrants issued to promoters in March 2025.

The investment follows an increase in the company's dealer network and product distribution footprint. Kinetic Engineering has signed letters of intent with over 150 dealers across India, with 60 dealerships operational featuring sales, service and spare parts operations. Promoter shareholding in Kinetic Engineering has increased from 50 percent to 69.27 percent over the past four years.

In its electric two-wheeler business, the company is focusing on its Kinetic DX and DX+ scooter models, which incorporate 3.1 kWh lithium iron phosphate battery packs that deliver a range of up to 132 kilometres under Indian Driving Cycle test conditions.

Ajinkya Firodia, Vice-Chairman and Managing Director, Kinetic Engineering, said, "Kinetic Engineering is entering an exciting phase of growth, with strong momentum across both our automotive components and electric mobility businesses. Our auto-components business is seeing a healthy pipeline of new orders, which will support growth and help us work towards our target of improving EBITDA margins to around 12%. At the same time, the response to our Kinetic DX electric scooter has been encouraging, giving us confidence to expand our presence across markets. With continued investments in capacity, technology and our retail network, we are focused on scaling both businesses and building Kinetic into a leading and enduring player in India’s electric mobility segment."

The company aims to secure a position among the top ten electric vehicle brands in India as industry projections indicate electric two-wheeler market volumes could expand from 1.8 million units to 7 million units by FY2030.

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Fluid transmission solutions provider Imperial Auto has opened its new Global Technology Centre in Backnang, Germany, expanding its engineering footprint within the European automotive sector.

Situated in the Stuttgart metropolitan area, the facility will function as a hub for technology development, engineering and customer collaboration. The centre is designed to support OEMs and Tier-1 suppliers across passenger cars, commercial vehicles, agricultural machinery, off-highway equipment and mobility applications by integrating European client requirements with Imperial Auto's global manufacturing infrastructure.

Vikram Wagh, Managing Director and CEO, Imperial Auto, said, “Europe is an important market for Imperial Auto, and establishing a dedicated technology centre in Germany is a significant step in our global growth journey. The centre will strengthen our ability to work closely with customers, understand their evolving technology and product requirements, and translate these insights into innovative solutions. Being closer to our customers will enable faster technical responses, more effective collaboration and stronger product development. The Backnang centre will also facilitate the exchange of engineering knowledge, technologies and best practices across our global network, helping us accelerate innovation and deliver reliable, future-ready solutions to customers across markets.”

The Backnang facility will house teams dedicated to product development and technical support, aiming to accelerate decision-making cycles and facilitate joint engineering initiatives between regional clients and the company's central development units.

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