Automobile parts companies look to tap unaffected countries amid US tariff threats

Automobile parts companies look to tap unaffected countries amid US tariff threats

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New Delhi: Indian auto parts makers are scurrying to devise alternative strategies to continue exports to the lucrative US market, ahead of impending fresh tariffs by the Trump administration. These include shipping parts from countries unaffected by the US government’s reciprocal tariff plan for ensuring product price competitiveness.

Senior company executives are reaching out to their US business partners to discuss measures for minimising potential impact on their operations, people familiar with the matter said.

US President Donald Trump has announced plans to impose reciprocal tariffs on India from April 2. Through this, the US plans to match India’s import duties product wise. The US currently has nil or comparatively lower import duties for most products imported from India.

US is currently the single-largest destination for Indian auto parts, accounting for 27% of outbound shipments. India’s auto parts exports to the US grew by 4.5% to $6.79 billion in FY24. Imports of auto parts from the US to India remained flat at $1.63 billion in the same period. US accounts for about 7% of auto parts imported into India.

India levies on average basic customs duty of 7-8% on parts imported into the country.


“The issue is President Trump is going bilateral. Firstly, based on the tariffs he levies on different countries, we have to evaluate our export competitiveness,” a senior industry executive said on condition of anonymity.

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