Trump's Auto Tariffs: A Double-Edged Sword for Indian Industry

US President Trump's imposition of a 25% tariff on auto imports could impact India's auto industry, especially its $7 billion exports to the US. Tata Motors' Jaguar Land Rover might see profitability challenges, while Indian auto component exporters face potential margin squeezes due to increased costs.

The Trump administration's recent decision to impose a hefty 25% tariff on all auto imports has thrown the Indian auto industry, particularly its export segment, into a state of flux. With auto component exports to the US totaling nearly USD 7 billion, industry experts fear a margin squeeze.

Tata Motors' Jaguar Land Rover, with a substantial presence in the US, faces potential profitability issues. Analysts suggest that passing these costs onto consumers could harm market share. Meanwhile, the establishment of a US manufacturing facility is being considered as a strategic countermeasure.

The tariff's broader impact on Indian auto component firms, including major exporters like Sona Comstar and Bharat Forge, is under scrutiny. As experts analyze the ramifications, Indian suppliers remain optimistic about leveraging their low-cost manufacturing advantage to retain market share in America.

(With inputs from agencies.)