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India’s Auto Exports To US Safe From Tariffs But Component Trade Faces Headwinds: VECV CEO
- India's auto exports to the US are expected to remain safe from tariffs, according to Vinod Aggarwal, CEO of Volvo Eicher Commercial Vehicles.
- The recent 25% tariffs imposed by US President Trump are unlikely to significantly affect India's automobile sector, but there may be challenges in the component trade.
- VECV, a joint venture between Volvo Group and Eicher Motors, has been operational since 2008, focusing on trucks and buses.
- India's overall impact might be cushioned as these tariffs are not only targeted at India but also affect imports from other countries like China, Canada, and Mexico.
- Aggarwal anticipates some impact on India's economy but believes it will not be significant due to strong domestic consumption.
- In fiscal 2026, Aggarwal is confident in the continued strength of the bus segment, citing growth in state transport undertakings and demand from schools and staffing sectors.
- He highlights a marginal growth in the commercial vehicle industry in FY25, with a drop in sales of heavy-duty trucks but a rise in demand for higher tonnage trucks.
- Despite a decrease in unit numbers, the actual freight movement may be higher, attributed to migration towards higher tonnage trucks.
- Aggarwal foresees growth in the bus segment driven by demand from schools, staffing, and state transport undertakings, indicating a positive outlook for fiscal 2026.
- Demand from various segments like schools, staffing, and intercity travel is expected to keep the bus segment strong according to Aggarwal.
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