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India’s Path to a Global Luxury Auto Hub

India’s Path to a Global Luxury Auto Hub

June 29, 2025 4 min read Consumer Discretionary
India’s Path to a Global Luxury Auto Hub

Q1. Could you start by giving us a brief overview of your professional background, particularly focusing on your expertise in the industry?

I have an overall experience of 29 years in the fields of Industrial and Automotive. My experience spans diverse functions, including Sales, Marketing, Sales Operations, Manufacturing Operations - Quality, Inbound Logistics and Supply Chain, and Strategic Planning.


Q2. How is the market for inbound logistics and supply chain orchestration platforms evolving in India’s premium automotive segment?

The inbound logistics and supply chain market has undergone dynamic evolution over the past few years, both in terms of volumes and the breadth of services offered by TPL service providers. Most of the inbound logistics for premium automotive manufacturers is a mix of CKD/SKD production, which relies primarily on imports through ocean freights. Over the years, value-added services like Container Freight Stations, Warehousing, and Plant Logistics have expanded their presence. Warehousing especially gained momentum during the post-Corona pandemic period, which disrupted the automotive supply chain. The use of warehouses by automotive OEMs allowed them to create buffers as ocean freight returned to normal. The post-corona period also saw a significant rise in air freight to transport critical parts from global supply chains. It was also a time when semiconductor shortages occurred, and many urgent shipments were sent by air.

Going forward, I see that inbound logistics will continue to grow at near double-digit rates due to a combination of the sector's organic growth and the addition of more services by logistics service providers, allowing them to focus on their core business of building and selling premium vehicles. 


Q3. Which manufacturing sub-segments are expected to see the highest CAGR over the next five years?

In the Indian premium/luxury market, the growth has been driven by SUVs for over 7-8 years. It is expected to continue as OEMs bring more models across all segments. 

Additionally, the premium luxury automotive market is driven by new features and technologies; this will be an important factor in driving growth. 

 

Q4. How is the growth of circular economy initiatives influencing demand for sustainable materials, remanufacturing, and reverse logistics in the luxury auto segment?

This is an important topic; globally, it's on the radar of luxury auto OEMs.
Europe’s ELV Directive and Circular Economy Action Plan mandate 30–35% recycled content and 85% vehicle-reuse, so OEMs now use recycled steel, bio-leathers, and plant-based composites—overcoming challenges of luxury material “look-and-feel”
Factory remanufacturing centers are rebuilding engines, transmissions, and electronics using up to 80% less energy and raw materials
EU-wide reverse logistics networks—takeback hubs, automated disassembly, and RFID/IoT tracking are being done to ensure the safe removal of hazardous substances and component reuse
In the U.S., despite the recent soft-pedaling of its sustainability policy, premium OEM brands maintain voluntary ESG targets and dealer-network takeback schemes for batteries and trims


Q5. How can India leverage its CKD assembly and supplier base to become a more attractive global hub for premium and luxury car manufacturing?

I can think of a few ways, some of which is already existing;

Upgrade CKD plants

  • Add real manufacturing tasks like welding, painting, and fine-trim so India isn’t seen just as a “bolt-together”
  • Run small runs of special, limited-edition models to prove you can meet luxury specs for the global market

Turn Tier-1s into global suppliers

  • Help more suppliers follow the Samvardhana Motherson example with tech transfers and co-development grants
  • Create local R&D clusters (material testing, noise/vibration labs) to speed up high-end part design

Leverage India’s engineering hubs

  • Utilize Global Capability Centers for digital twin design, virtual line commissioning, and parts validation
  • Bundle design-for-manufacture services with local CKD capacity, allowing brands to test models on-site

Build an EV/luxury ecosystem

  • Make India a low-cost base for battery-pack assembly, module remanufacturing, and second-life energy storage
  • Incentivize precision e-motor and power-electronics machining for CKD EVs and exports

Strengthen policy support

  • Tariff breaks & FTAs
  • Automotive free zones with single-window clearances, on-site customs, and plug-and-play utilities
  • Partner with institutes (IITs, NATRiP) on fast-track training in robotics, additive manufacturing, and clean-room paint
     

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