$ 5 bn opportunity in auto parts via material circularity
ECONOMY & POLICY

$ 5 bn opportunity in auto parts via material circularity

According to a McKinsey report released during the 63rd annual session of the Automotive Component Manufacturers Association of India (ACMA), India's automobile parts industry may see a market opportunity ranging from $ 3.8 to $ 5 billion by the Financial Year 2029-30 (FY30) through the practice of component circularity, which involves the reuse or recycling of materials.

The report, titled 'Mobility 360 degrees – Sustainability for Competitiveness,' outlined that embracing material circularity could lead to several benefits for companies. Specifically, it could boost the top line by 10-20%, reduce costs by 5-10%, decrease virgin material usage by 20-40%, and cut carbon emissions by 50-70%.

The global automotive industry is increasingly adopting the concept of a circular economy, which aims to keep materials, products, and services in circulation for as long as possible. A report jointly published by the World Economic Forum and Accenture suggests that a car produced under the circular economy model could potentially reduce the automotive industry's carbon emissions throughout its lifecycle by up to 75% by 2030.

The McKinsey report stated, "The market opportunity for automotive component circularity by FY30 is estimated to be in the range of $ 3.8 to 5 billion, encompassing three key themes – material recirculation, circular product design and repair, care, and refurbishment services." It also highlighted the challenges in promoting material circularity in India, including the presence of disorganised recyclers, high costs, low recovery rates for e-waste and reusable parts, as well as the demand for recycled products and the complexity of recycling certain components.

However, the report suggested that these barriers could potentially be overcome over time with the help of supportive policies and regulatory measures, such as the Vehicle Scrappage Policy of 2022. Additionally, improvements in recycling economics and advancements in recycling technologies could contribute to the growth of material circularity in the Indian automobile industry.

Also read:
Indian domestic air passenger traffic increased by 23%
Haryana Plans Airstrip Expansion for Better Regional Connectivity

According to a McKinsey report released during the 63rd annual session of the Automotive Component Manufacturers Association of India (ACMA), India's automobile parts industry may see a market opportunity ranging from $ 3.8 to $ 5 billion by the Financial Year 2029-30 (FY30) through the practice of component circularity, which involves the reuse or recycling of materials. The report, titled 'Mobility 360 degrees – Sustainability for Competitiveness,' outlined that embracing material circularity could lead to several benefits for companies. Specifically, it could boost the top line by 10-20%, reduce costs by 5-10%, decrease virgin material usage by 20-40%, and cut carbon emissions by 50-70%. The global automotive industry is increasingly adopting the concept of a circular economy, which aims to keep materials, products, and services in circulation for as long as possible. A report jointly published by the World Economic Forum and Accenture suggests that a car produced under the circular economy model could potentially reduce the automotive industry's carbon emissions throughout its lifecycle by up to 75% by 2030. The McKinsey report stated, The market opportunity for automotive component circularity by FY30 is estimated to be in the range of $ 3.8 to 5 billion, encompassing three key themes – material recirculation, circular product design and repair, care, and refurbishment services. It also highlighted the challenges in promoting material circularity in India, including the presence of disorganised recyclers, high costs, low recovery rates for e-waste and reusable parts, as well as the demand for recycled products and the complexity of recycling certain components. However, the report suggested that these barriers could potentially be overcome over time with the help of supportive policies and regulatory measures, such as the Vehicle Scrappage Policy of 2022. Additionally, improvements in recycling economics and advancements in recycling technologies could contribute to the growth of material circularity in the Indian automobile industry. Also read:Indian domestic air passenger traffic increased by 23% Haryana Plans Airstrip Expansion for Better Regional Connectivity

Next Story
Infrastructure Urban

Aadhaar Authentications Cross 27 Billion in FY25

Aadhaar authentication transactions surged past 27.07 billion in FY 2024–25, including 2.47 billion in March alone, reflecting its growing adoption across sectors such as banking, finance, telecom, and public service delivery. Since its inception, the cumulative number of Aadhaar authentication transactions has exceeded 148 billion.The Unique Identification Authority of India’s (UIDAI) AI/ML-based face authentication technology is also witnessing a sharp rise in usage. In March 2025 alone, over 150 million face authentication transactions were recorded. This biometric modality is now used ..

Next Story
Infrastructure Urban

IEPFA Holds Preparatory Meet for 'Niveshak Shivir' Initiative

The Investor Education and Protection Fund Authority (IEPFA), under the Ministry of Corporate Affairs, Government of India, hosted a preparatory meeting on April 28, 2025, with Nodal Officers from stakeholder companies via video conference. The session, chaired by IEPFA CEO Smt. Anita Shah Akella, focused on finalising operational plans for the upcoming ""Niveshak Shivir"" initiative—a joint effort between IEPFA and the Securities and Exchange Board of India (SEBI).""Niveshak Shivir"" aims to improve investor services and streamline the claims process by reaching out to cities with a high nu..

Next Story
Infrastructure Urban

India, France Sign Deal for 26 Rafale-Marine Jets for Navy

India and France have signed an Inter-Governmental Agreement (IGA) for the acquisition of 26 Rafale-Marine aircraft for the Indian Navy, comprising 22 single-seater and four twin-seater jets. The deal also includes training systems, simulators, associated equipment, weapons, and performance-based logistics, along with additional equipment for the Indian Air Force’s existing Rafale fleet.The IGA was signed by India’s Defence Minister Rajnath Singh and French Minister of Armed Forces Sébastien Lecornu. The agreement, along with supply protocols for aircraft and weapons, was exchanged in the..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?