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

Mount Invests Rs 250 Cr, Adds PUF & PEB Plants, 400+ Jobs

TUMKUR, Karnataka, January 8, 2025 - Mount Roofing & Structures Private Limited, one of India's  fastest-growing manufacturers in PUF and a leading solutions provider across Pre-Engineered Building  (PEB) and Polycarbonate sheets, simultaneously inaugurated its second fully automated continuous  Sandwich Panel manufacturing line and a new PEB manufacturing plant at its integrated campus in  Tumkur." The milestone expansion, part of a total investment of INR 250 crores, marks a significant  advancement in the company's commitment to engineered performance, manu..

Next Story
Infrastructure Urban

Titan Intech Strengthens UltraLED Push With Global LED Veteran

Titan Intech has announced the induction of global LED industry veteran Su Piow Ko to its Board of Directors, marking a strategic step in strengthening its UltraLED Displays roadmap and building globally competitive LED display solutions from India.The appointment aligns with Titan Intech’s ambition to position India as a hub for advanced, high-quality LED display manufacturing. With an increased focus on UltraLED Displays, the company aims to enhance technical governance, raise manufacturing standards and expand its presence across global markets.Su Piow Ko brings over three decades of inte..

Next Story
Infrastructure Urban

Dun & Bradstreet Flags New Growth Engines in India 2026 Outlook

Dun & Bradstreet has released its India 2026: D&B’s Perspective report, projecting a stable macroeconomic environment underpinned by fresh opportunities for productivity-led and inclusive growth. The report outlines how India’s next growth phase will be driven by digitised logistics, trusted data ecosystems, clean energy and rising city vitality.According to the outlook, India’s GDP growth is expected to reach around 6.6 per cent by FY2027, supported by resilient consumer demand and sustained public investment. Manufacturing is seen entering a new phase, moving beyond scale towar..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Open In App