Hyundai, Maruti push deeper localisation as auto-component trade deficit hits $1.4bn
Hyundai Motor India and Maruti Suzuki are calling for domestic production of chips, battery cells, magnets and power electronics, citing supply-chain risk and a $1.4 billion auto-component trade deficit in 2025-26.
What happened
Hyundai Motor India and Maruti Suzuki urged deeper localisation of chips, battery cells, magnets and power electronics to reduce import dependence, strengthen
Key facts
- $24 billion auto-component exports in 2025-26
- $25.4 billion auto-component imports in 2025-26
- $1.4 billion auto-component trade deficit
Why this matters
Hyundai, Maruti and their suppliers may pursue JVs, technology licensing and acquisitions to accelerate domestic capability in high-value components.
What to watch
- Union budget or industrial-policy incentives for semiconductors, battery cells, rare-earth processing and automotive electronics.
- Announcements of local chip OSAT/ATMP capacity, automotive-grade qualification programs or guaranteed OEM purchase commitments.
- Battery-cell and magnet manufacturing investments reaching commercial production rather than memorandum-of-understanding stage.
- Changes in import duties, production-linked incentives or localization thresholds for EV and hybrid components.
- Movement in the auto-component import-export gap and the share of high-value electronics in imports.
- Rare-earth supply disruptions, China export controls, or automotive-chip shortages that strengthen the resilience case.
- Hyundai and Maruti seek joint policy support for chip packaging, battery-cell manufacturing, magnet supply and power-electronics production.
- Automakers increase long-term offtake agreements with domestic cell, electronics and component suppliers to make capacity investments bankable.
- Tier-1 suppliers pursue Indian joint ventures, localization mandates and expanded R&D centers rather than standalone imported-kit assembly.
- Vehicle makers redesign platforms to increase commonized locally sourced components across ICE, hybrid and EV models.
- Procurement teams diversify away from China-centric sourcing, raising demand for India-based testing, tooling, materials processing and component certification.