Part makers resembling Tata AutoComp Techniques Ltd, Bosch Ltd, Belrise Industries Ltd, Uno Minda Ltd and Bosch Ltd have both kicked off capability growth plans or are evaluating them, as demand rises for wheels, seating methods, and electrical car parts. Massive automakers have already pointed to the necessity for capability growth at their suppliers.
Bosch Ltd, which makes braking and gas injection methods and electrical drive items, critiques capability and funding plans primarily based on quantity tendencies, chief monetary officer Karin Gilges instructed analysts on 9 February. The corporate routinely checks predicted volumes, analyses capacities and adjusts investments in each demand cycle, Gilges stated. In the meantime, Uno Minda expanded capability at alloy wheel factories in Maharashtra and Haryana and commissioned a brand new plant in Haryana. The corporate board has signed off on one more wheel plant in Haryana, group CFO Sunil Bohra instructed analysts on 5 February.
Shares of Uno Minda and Bosch are up 39% and 33% over the previous one yr, whereas the Nifty Auto and the benchmark Nifty are up 29% and 12% respectively.
Extracting extra
Harshvardhan Sharma, group head of automotive expertise and innovation at Nomura Analysis Institute, stated capability additions at present are targeted by extraction of extra items from current vegetation. “Capability utilization at suppliers has moved to the 75-85% vary, which is often the set off zone for growth,” Sharma stated.
“Nonetheless, as an alternative of launching massive greenfield tasks, most gamers are including 5-10% capability by debottlenecking and brownfield growth. A broad capex cycle would require sustained 3–4 quarter demand visibility and stronger export momentum,” he added.
The necessity for provider capability growth comes because the automakers themselves look to broaden their factories. The nation’s prime 4 carmakers, Maruti SuzukiMahindra and Mahindra, Hyundai Motor India, and Tata Motors PV, are set to cumulatively add greater than 2 million items of capability within the subsequent 4 years. Over 3.7 million vehicles and 17.8 million two-wheelers had been bought in India until the tip of January this monetary yr, a development of 6% and eight% respectively, knowledge from the Society of Indian Vehicle Producers confirmed.
The historic GST reform in September lowered the speed on small vehicles and two-wheelers as much as 350cc from 28% to 18%. The reform aimed to spice up mass-market demand by making entry-level autos considerably extra inexpensive, whereas concurrently eliminating the compensation cess to simplify the general tax construction for the sector.
Within the December quarter, gross sales of two-wheelers and vehicles gross sales touched document highs. Based on Siam knowledge, two-wheeler gross sales grew 17% year-on-year to five.7 million items, whereas passenger car gross sales grew 21% to 1.3 million items.
Greater demand
Belrise Industries, a maker of suspension and exhaust methods, arrange a Haridwar plant within the December quarter—the most important since its public itemizing in Might 2025, after successful a big order from a number one two-wheeler maker, managing director Shrikant Badve stated at a 2 February earnings name. “Our Chennai plant ramped up manufacturing according to rising OEM volumes, the place we’re the one supply provider for a key 2-wheeler EV platform,” Badve stated.
Tata AutoComp opened two new items in Gujarat on 30 January beneath seating and thermal methods enterprise items. “These new amenities mark a significant milestone in Tata AutoComp’s strategic development, enhancing our potential to assist OEM companions and reply successfully to evolving platform necessities,” vice-chairman Arvind Goe stated in an announcement.
The capability query got here into the highlight after two main auto makers, Tata Motors Passenger Autos Ltd and Hero MotoCorp, pointed to the necessity for bigger capability at their suppliers throughout earnings calls.
Vendor energy
Shailesh Chandra, managing director and chief govt at Tata Motors PV, instructed analysts in a 5 February earnings name that the corporate is engaged on ramping up each inside capacities and growth of suppliers’ capabilities. “At Tier 1 to Tier 3 provider degree, particularly, as an example, for instance, castings and all, we’re seeing that there’s a common capability constraint that’s coming. So, we’re engaged on enhancing the capacities and ramping up the provides from the provider,” Chandra stated.
An analogous engagement with auto suppliers can also be underway at Hero MotoCorp, with chief govt Harshavardhana Chitale telling analysts how the corporate feels capacities must rise on the provider degree.
There’s a want to extend capability rapidly as high-growth segments like EVsthe export portfolio of bikes and scooters, and scooters normally are rising at a fast tempo, Chitale stated at an earnings name on 6 February.