Key Details
India's automotive aftermarket is transitioning from a fragmented spare-parts ecosystem to a technology-intensive industry supported by regulatory reforms, localisation initiatives, digital commerce, and the rapid adoption of electric and connected vehicles.
Transformation Driver | Key Evidence | Implication |
|---|---|---|
Growing vehicle base | More than 39 crore registered vehicles and an aftermarket valued at ₹1.04 lakh crore | Creates sustained demand for servicing, maintenance and replacement components. |
Regulatory upgrades | BS-VI, RDE testing, BNCAP and advanced vehicle safety requirements | Increases demand for sophisticated diagnostics, sensors and skilled servicing. |
Manufacturing & localisation | Auto Component PLI Scheme (₹25,938 crore) with ₹67,690 crore proposed investment | Encourages domestic production of advanced automotive technologies. |
Electrification | PM E-DRIVE supported 16.29 lakh EVs by June 2025 | Expands demand for battery management, power electronics and software-enabled maintenance. |
Export competitiveness | Component turnover reached ₹6.73 lakh crore, with exports of ₹1.92 lakh crore | Strengthens India’s position in global automotive supply chains. |
India’s Automotive Aftermarket Is Becoming Technology-Driven
The CII report, Navigating the Aftermarket Shift: Growth, Safety and the Counterfeit Reality, examines how India’s automotive aftermarket is being reshaped by simultaneous changes in vehicle technology, regulation and manufacturing policy. Traditionally centred on replacement parts and routine vehicle maintenance, the sector is increasingly becoming a technology-intensive ecosystem requiring advanced components, digital diagnostics, specialised servicing and stronger quality assurance.
This transition is being driven not by a single technological shift but by the combined effects of stricter emission standards, vehicle electrification, connected mobility and localisation policies.
Regulation Is Changing the Nature of Vehicle Servicing
The report identifies regulatory reforms as one of the strongest drivers of transformation.
The implementation of BS-VI emission norms, Real Driving Emissions (RDE) testing, Bharat NCAP and growing adoption of Advanced Driver Assistance Systems (ADAS) have significantly increased the technological complexity of modern vehicles.
As a result, aftermarket demand is shifting away from conventional mechanical repairs towards advanced electronics, sensors, emission-control systems, software diagnostics and specialised maintenance. Workshops increasingly require new equipment and higher-skilled technicians to service modern vehicles.
Electrification and Digitalisation Are Creating New Business Models
The report highlights that electric vehicles are changing both the products supplied and the services delivered across the aftermarket.
Although EVs contain fewer moving mechanical parts, they generate growing demand for battery systems, thermal management, high-voltage servicing, power electronics and software diagnostics.
Digitalisation is also transforming business operations through connected vehicles, predictive maintenance, telematics, online spare-parts marketplaces, digital payments and inventory management systems, making aftermarket services increasingly data-driven.
Quality Assurance Is Emerging as a Strategic Priority
The report identifies counterfeit automotive components as one of the sector’s most persistent challenges.
It recommends expanding BIS certification for safety-critical components while strengthening e-commerce compliance, customs enforcement and product authentication through technologies such as QR codes, RFID tagging, blockchain traceability and AI-enabled verification.
The report argues that stronger quality assurance will become increasingly important as vehicles rely more heavily on electronically integrated and safety-critical systems.
The Sector’s Competitiveness Will Depend on Technology Adoption
The report concludes that India possesses several structural advantages—including a large domestic vehicle fleet, expanding manufacturing capacity, skilled engineering talent and growing exports—that can support the evolution of the automotive aftermarket into a globally competitive industry.
Government initiatives such as the Auto Component PLI Scheme, PM E-DRIVE, the Vehicle Scrappage Policy and Automated Fitness Testing Centres are expected to reinforce localisation, technological capability and export competitiveness across the automotive value chain.
What is the Automotive Aftermarket?
The automotive aftermarket comprises the industries that supply vehicle maintenance, repair, replacement parts, accessories and servicing after a vehicle has been sold. It includes manufacturers, distributors, workshops, retailers, digital service providers and independent repair networks.
Policy Relevance
The report suggests that the automotive aftermarket should increasingly be viewed as a strategic manufacturing sector rather than simply a vehicle repair industry.
The findings reinforce that emission standards, vehicle safety regulations and electrification policies are driving demand for advanced components, diagnostics and specialised technical skills across the automotive value chain.
The report highlights the importance of localisation, indicating that initiatives such as the Auto Component PLI Scheme can strengthen domestic production of high-value automotive technologies while reducing import dependence.
Its recommendations on quality assurance underscore the need to expand BIS certification, strengthen anti-counterfeiting measures and improve digital product traceability as vehicles become more technologically sophisticated.
The report also points to emerging workforce priorities, suggesting that technician reskilling and specialised EVand electronics training will become essential as software-defined vehicles (SDVs) and electric vehicles (EVs)gain market share.
The broader lesson is that industrial competitiveness in the automotive sector will increasingly depend not only on vehicle manufacturing but also on developing advanced aftermarket capabilities in servicing, diagnostics, digital technologies and quality assurance.
Follow the Full Report Here: Navigating the Aftermarket Shift: Growth, Safety and the Counterfeit Reality