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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Tata Motors, one of the country’s largest automakers, has announced a landmark financial performance for FY2025, achieving record revenues and profitability, becoming debt-free, and confirming the ongoing process to demerge into two independent listed entities. The announcement was made by N Chandrasekaran at the 80th AGM of Tata Motors, on 20 June 2025.

In his address, he mentioned that on a consolidated basis, the Tata Motors Group delivered record high revenue of INR 4,396 billion, a record EBITDA of INR 576 billion, and a record Profit Before Tax (PBT) of INR 343 billion (before exceptional items). This robust performance has enabled the Tata Motors Group to achieve a debt-free status this year.

The company highlighted strong individual performances across its business segments:

• Commercial Vehicles (CV): Achieved INR 751 billion in revenue, a record EBITDA of INR 88 billion, and INR 75 billion in Free Cash Flows, with a strong ROCE of 37.7 percent.
• Passenger Vehicles (PV): Generated revenues of INR 484 billion with a 0.9 percent EBIT. The Tata Punch emerged as India’s top SUV, with CNG and EVs comprising 36 percent of its multi-powertrain portfolio.
• Jaguar Land Rover (JLR): Delivered solid results with revenues of GBP 28.9 billion and an 8.5 percent EBIT, resulting in a PBT of GBP 2.5 billion, turning net cash this year. The Range Rover and Defender franchises continued their strong performance, complemented by localized CKD manufacturing of Range Rover and Range Rover Sport in India.

The strategic demerger process, which will see the company operate as two independent listed entities – one for Commercial Vehicles and one for Passenger Vehicles and JLR – is well underway and expected to be completed by the end of the calendar year.

Chandrasekaran mentioned that each business is positioned for independent growth, supported by strengthened financials and dedicated management teams.

Despite anticipated future volatility from geopolitical conflicts, supply chain shifts, AI, and energy transition, he stated its businesses are structured to thrive, building on years of simplification and strategic investments.

The company also acknowledged the recent passing of Mr. Ratan Tata, noting his profound impact and enduring legacy on the Group.

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India's automotive sector is poised for a significant transformation with the establishment of the Indian School for Design of Automobiles (INDEA), the nation's first dedicated institution for automobile design and management. A groundbreaking and foundation stone ceremony was held today at the XLRI Delhi-NCR campus, marking a historic milestone for the nascent institute.

The Union Minister of Road Transport and Highways, Nitin Gadkari, served as the Chief Guest, virtually unveiling the foundation stone and offering his full support for the forward-thinking initiative. His virtual presence underscored the government's recognition of design's crucial role in India's evolving mobility landscape.

The ceremony brought together a distinguished gathering, including industry titans, senior government officials, design and automotive professionals and academic luminaries. The consensus among attendees was clear: design is rapidly gaining importance within India's mobility ecosystem, and INDEA is positioned to be a cornerstone of this shift.

Developed under the umbrella of XLRI’s Centre for Automobile Design & Management (XADM), INDEA aims to revolutionise design education in India. Avik Chattopadhyay, Founder of INDEA and Chairperson of XADM, is leading the charge to cultivate a new generation of automotive designers and visionaries. The institute's mission is to equip these future professionals with the skills needed to meet both global standards and unique local requirements.

A striking steel structure, named Param – a Sanskrit word signifying supreme, highest, or ultimate – was unveiled as the foundation pillar. Designed by renowned Indian installation artist and designer Vibhor Sogani, the skyward-reaching sculpture symbolises INDEA's aspirations for boundless growth and transformative knowledge. Param is envisioned as the symbolic heart of the institute, representing not just a foundation but a future hub for innovation and excellence with state-of-the-art facilities fostering a community of innovators, thinkers and leaders in automotive design.

In his virtual address, Nitin Gadkari emphasised the automotive sector's critical role in India's economic growth, employment generation and global competitiveness. "As we strive towards the Prime Minister’s USD 5 trillion economy vision, our industry is evolving from being cost-driven to quality-led, anchored in smart design, robust safety, and sustainable practices. The future will be shaped by strong R&D, innovation, and next-generation testing and certification. I am confident that the young talent trained at INDEA will become catalysts for change, turning knowledge into innovation, and innovation into national strength."

Fr. Dr. K.S. Casimir, Director, XLRI Delhi-NCR, said, "This ceremony marks a major leap in our vision of creating an institute that seamlessly blends design thinking, technical prowess, and industry alignment. Nitin Gadkari’s digital presence as Chief Guest is not only an honour but also a strong endorsement of the vital role that design can play in India’s mobility future."

Avik Chattopadhyay echoed these sentiments, asserting, "INDEA is designed to be more than just an educational institute – it is a movement to elevate India’s design capabilities. With the encouragement of leaders like Nitin Gadkari and guided by the vision of our Prime Minister Narendra Modi, we are confident INDEA will become a key enabler in India’s journey to becoming a global design and innovation hub."

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German technology giant Freudenberg Group has announced the expansion of its Freudenberg Training Centre in Nagapattinam, Tamil Nadu, reinforcing its long-term commitment to community development in India.

Esther Maria Loidl, Chief Human Resources Officer and global board member of Freudenberg & Co., laid the foundation stone for a new extension and auditorium at the training campus. The upgrade will include converting the existing auditorium into a computer lab, with a focus on offering digital and computer-based vocational courses. The new facilities are expected to be completed by mid-2026.

The expansion aims to attract and support more women students, equipping them with skills for financial independence and sustainable employment. The centre, established in 2008 in the aftermath of the 2004 tsunami, offers training in welding, fitting, machining, motor mechanics and electrical work. It has trained over 1,400 students to date, many of whom are now employed at leading firms such as Hyundai Motor India, TVS Motor Co and Simpson Group, while some have launched their own ventures.

Freudenberg has invested over INR 400 million in the region over the past 16 years. The 28-acre training campus is staffed by 18 qualified educators and led by Principal Dr Chitrakala Mohan.

Esther Maria Loidl, said, “It’s a pleasure and privilege to lay the foundation for further expansion of our largest CSR initiative in India - the Freudenberg Training centre in Nagapattinam. The institute’s growth affirms the visionary decision in 2008 to support the region’s rebuilding by empowering its young people with the right vocational skills. We look forward to investing and supporting the institute to grow further in its noble mission to power the aspirations of the needy in this region.”

G Sivasailam, Director & CEO, Freudenberg Regional Corporate Center India & Managing Director, Freudenberg Performance Materials India, said, "I am immensely proud to see the growth of the institute to where it is today. This reaffirms many of the core values of the Freudenberg group – long-term commitment, proactive and responsible action, among others. I would like to credit the Principal and her faculty who have been instrumental in ensuring the delivery of quality education to the local youth. They have been constantly innovating and adding to the courses and teaching pedagogy to what it provides is needed in the industry.”

Dr Chitrakala Mohan, Principal, Freudenberg Training Center, said, “It has been a great journey leading this visionary initiative for 7 years. The whole-hearted and passionate support we receive from the group executives in India and at the global HQ has been pivotal to whatever we’ve been able to accomplish so far. The foundation laying today and the other initiatives in the pipeline will help us expand sustainable community development through world-class vocational education, which sees local youth gainfully employed with leading companies in India.”

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Daimler Truck, Mitsubishi Fuso, Hino and Toyota Motor Corporation have concluded definitive agreements to integrate Mitsubishi Fuso and Hino Motors. The arrangement has Daimler Truck and Toyota Motor Corporation at the top. The motive behind the definitive agreements being to integrate Mitsubishi Fuso and Hino on equal footing, the change is expected to affect over 40,000 people. They will have to learn some as the two automotive giants – Daimler and Toyota – sat through, thought through and came to an agreement, creating yet another value intensive enterprise that will be headed by Karl Anton Deppen as the CEO.   
Bundling forces to establish a new strong Japanese truck powerhouse to the benefit of all stakeholders, the agreement to integrate the two Japanese commercial vehicle manufacturers aims at a new listed holding company that will begin operations in April 2026. It will have the scale, resources and technology leadership to shape the future of the commercial vehicle landscape in the Asia-Pacific region and beyond

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