India’s auto parts industry may face some pressure due to US tariffs, but experts believe the situation will improve in the long term, starting around 2027, according to a senior official of the Automotive Component Manufacturers Association of India (ACMA).

Vikrampati Singhania, President of ACMA, said that the impact of US tariffs has not been strongly felt yet. However, the real effect may be seen later this year or even next year. He explained that auto companies usually take time to change suppliers because they need to test and approve new ones. Because of this, any slowdown caused by tariffs may be visible only in 2027, not immediately.

He added that some new investment plans have slowed down for now, but many companies already have factories in eastern Europe and Mexico, which helps them manage risks. Some Indian auto component companies are also considering setting up production units outside India as an alternative.

ACMA data shows that during April to September 2025 (H1 FY26), India’s auto parts exports to the US fell slightly to $3.64 billion, compared to $3.67 billion last year. On the other hand, imports from the US increased slightly during the same period.

Talking about overall industry performance, Singhania said the first half of FY26 was stable, supported by domestic demand. He expects the second half of the year to be better, helped by improved consumer confidence, festive demand, government policies, and infrastructure projects.

According to ACMA, the auto component industry grew by 6.8% in H1 FY26, reaching ₹3.56 lakh crore. Exports rose by 9.3%, while imports increased by 12.5%, leading to a small trade deficit.

Despite global challenges like supply chain problems and high raw material costs, the industry showed resilience. The US and Germany remained key export markets, while China, Japan, and Germany were major import sources. ACMA officials said India’s auto industry remains strong and is preparing for future growth, especially in new mobility technologies.