The President of the Federation of Automobile Dealers Associations (FADA), C.S. Vigneshwar, has raised concerns about the potential impact of prolonged conflict in West Asia on India’s automotive sector.
Speaking on the sidelines of the Vyapar Delhi event, Vigneshwar said that ongoing geopolitical tensions could disrupt exports and affect the supply of key inputs such as oil and aluminium. While India’s domestic auto market has shown strong resilience following a period of robust growth, extended instability could pose challenges for both production and global trade.
He explained that the sector is particularly vulnerable to fluctuations in oil supply, which affects fuel, lubricants, and overall vehicle operations. In addition, shortages of gas and aluminium could hinder manufacturing. Although he expressed confidence in government efforts to mitigate these risks, he acknowledged that the industry may face difficulties in the coming months if the conflict continues.
Vigneshwar also highlighted concerns about a potential decline in vehicle exports, even as domestic demand remains strong. He noted that the industry recorded approximately 13% growth across segments last year, providing a buffer against global uncertainties. Despite possible disruptions, he remains optimistic about continued domestic performance.
He further emphasized the importance of managing supply chain disruptions, especially given India’s dependence on imported resources like lithium. Stressing the need for balance, he called for accelerated development of domestic lithium reserves and battery manufacturing capabilities.
On the electric vehicle (EV) front, Vigneshwar pointed out steady growth in adoption rates. Electric two-wheelers have reached around 9% market share, while passenger vehicles stand at about 5–6%, and commercial vehicles at roughly 2%. He underscored the importance of building a strong ecosystem to support cleaner mobility solutions and prepare for future demand.
The Vyapar Delhi event brought together dealers, OEMs, policymakers, and industry stakeholders, including the Chief Minister of Delhi, as well as representatives from insurance and finance sectors, to discuss challenges and shape future policy directions for the automotive industry.
(With inputs from ANI)