New regulations to boost profits for auto parts companies
Equipment

New regulations to boost profits for auto parts companies

Manufacturers of automotive components have benefited greatly from the enormous trend toward electrification and the forthcoming slew of safety and emission regulations. According to top executives at auto component companies the new regulations and the trend toward electrification are resulting in an increase in the amount of content per vehicle, thereby increasing their revenue and profitability.

According to Ashwath Ram, Managing Director, Cummins India, businesses like Cummins have succeeded and managed to increase business with every automaker whenever emission standards have become stricter and fuel economy regulations have become more stringent. Beginning on April 1, the auto industry in India will switch to Bharat Stage VI-B emission standards. By the beginning of the following fiscal year, manufacturers of passenger vehicles would also be required to share with the government their corporate average fuel economy (CAFE-II) scores.

Companies must also comply with RDE (Real Driving Emissions) regulations in accordance with BSVI-B standards. Because vehicles will require new components, this is likely to result in an increase in prices across all categories. According to Hemal Thakkar, Director, CRISIL Research “The price increase for gasoline vehicles could be less than two per cent, while it could be between 3.0 per cent and 3.5 per cent for diesel vehicles.

Ram of Cummins stated the regulations will help the company grow and the intention is to expand its business at a rate twice as fast as the country's GDP growth. "While we are doing that, we want to increase our profits by one percent annually until we reach our highest historical profit levels of 18 to 20 percent," he said.

Manufacturers of automotive components have benefited greatly from the enormous trend toward electrification and the forthcoming slew of safety and emission regulations. According to top executives at auto component companies the new regulations and the trend toward electrification are resulting in an increase in the amount of content per vehicle, thereby increasing their revenue and profitability. According to Ashwath Ram, Managing Director, Cummins India, businesses like Cummins have succeeded and managed to increase business with every automaker whenever emission standards have become stricter and fuel economy regulations have become more stringent. Beginning on April 1, the auto industry in India will switch to Bharat Stage VI-B emission standards. By the beginning of the following fiscal year, manufacturers of passenger vehicles would also be required to share with the government their corporate average fuel economy (CAFE-II) scores. Companies must also comply with RDE (Real Driving Emissions) regulations in accordance with BSVI-B standards. Because vehicles will require new components, this is likely to result in an increase in prices across all categories. According to Hemal Thakkar, Director, CRISIL Research “The price increase for gasoline vehicles could be less than two per cent, while it could be between 3.0 per cent and 3.5 per cent for diesel vehicles. Ram of Cummins stated the regulations will help the company grow and the intention is to expand its business at a rate twice as fast as the country's GDP growth. While we are doing that, we want to increase our profits by one percent annually until we reach our highest historical profit levels of 18 to 20 percent, he said.

Next Story
Infrastructure Urban

GRAP Stage-I Revoked as Delhi AQI Improves to 140

The Air Quality Index (AQI) in Delhi reached 140 on 15 June 2025, categorised as 'Moderate', according to the Central Pollution Control Board’s (CPCB) daily bulletin. With steady improvement in air quality and favourable forecasts from IITM and the India Meteorological Department (IMD), the Commission for Air Quality Management (CAQM) has revoked Stage-I of the Graded Response Action Plan (GRAP) across the National Capital Region (NCR) with immediate effect.The decision was made during a review meeting of the CAQM’s Sub-Committee on GRAP, which assessed overall regional air quality data an..

Next Story
Infrastructure Transport

India, CMA CGM Boost Maritime Ties in Marseille Visit

Shri T.K. Ramachandran, Secretary of the Ministry of Ports, Shipping and Waterways (MoPSW), visited the global headquarters of CMA CGM in Marseille, France, on 12 June 2025. The visit builds on Prime Minister Narendra Modi’s February 2025 trip to France, during which maritime sector growth and global partnerships were highlighted as key focus areas.During the meeting with CMA CGM’s senior leadership, the Secretary reviewed the Group’s expanding footprint in India across shipping, shipbuilding, container terminals, multimodal logistics, and maritime industrial development. CMA CGM detaile..

Next Story
Infrastructure Urban

Workshop in Patna Pushes Ganga Waterway Development

The Inland Waterways Authority of India (IWAI) is hosting a consultative workshop in Patna on 16 June 2025 to advance inland waterways transport on National Waterway 1 (NW1) under the Jal Marg Vikas Project (JMVP). This is the first such workshop in Bihar, marking a significant move to position Patna as a future hub for inland water transport.The high-level inter-ministerial event will be chaired by Union Minister of Ports, Shipping & Waterways, Shri Sarbananda Sonowal, with participation from Union Textiles Minister Shri Giriraj Singh, Minister of State for Shipping Shri Shantanu Thakur, ..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?