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Andy Palmer: India’s Auto Industry at a Crossroads

Andy Palmer: India’s Auto Industry at a Crossroads

by admin
July 4, 2025
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<p>“You either lead or follow. The road to following will just make you obey China. But India uniquely has the opportunity to create something that’s competitive.”</p>
“You both lead or comply with. The street to following will simply make you obey China. However India uniquely has the chance to create one thing that’s aggressive.”

When Dr Andy Palmer, former Aston Martin CEO and the person credited with launching the world’s first mass-market EV, the Nissan Leaf, speaks about the way forward for automotive, he doesn’t mince phrases. Throughout his current go to to India, Palmer described the nation as being at a historic crossroads, one the place it should determine whether or not to proceed as a know-how follower or emerge as an innovator in its personal proper.

“You both lead or comply with. The street to following will simply make you obey China. However India uniquely has the chance to create one thing that’s aggressive,” he stated in an unique dialog with ETManufacturing.

A market with momentum, however gaps to shut

India’s automotive sector is now the third largest on the planet, having surpassed Japan in 2023. The nation produced practically 5 million passenger automobiles and over 20 million two-wheelers in FY 2023. Gross sales of passenger automobiles crossed the three million mark final yr, and regardless of international provide chain constraints, the market continues to publish constant year-on-year development of 5–7 %.

On the electrical automobile entrance, India registered over a million EV gross sales in 2023, a 25 % leap over the earlier yr, with robust traction within the two-wheeler and three-wheeler segments.

Nevertheless, Palmer famous that whereas the numbers are promising, India’s tempo nonetheless lags far behind China, the place EV gross sales have crossed 4 million models yearly and the place the federal government’s industrial push towards clear mobility started as early as 1992.

Batteries and the query of technological independence

For Palmer, the actual battleground within the EV transition isn’t automobile meeting, it’s batteries. China right this moment controls practically 70 to 80 % of world lithium-ion battery manufacturing capability. It additionally dominates all the battery worth chain, from uncooked materials mining to refining and cell manufacturing. India, in contrast, has simply two to a few gigawatt-hours of put in cell manufacturing capability. Regardless of the central authorities’s Manufacturing Linked Incentive (PLI) schemes aiming to create 50 GWh of battery output by 2030, progress has been gradual and uneven.“If India chooses to maintain importing battery cells, it is going to be tied to the pricing and politics of others,” Palmer warned. “But when it invests now in next-generation chemistrieslike sodium-ion, NMC, solid-state, it may set the worldwide benchmark. The query is whether or not you need to be a buyer or a competitor.”

Palmer challenged India to rethink its dependence on imported battery applied sciences and as a substitute lead the event of rising alternate options. Sodium-ion batteries, which don’t depend on lithium, current a novel alternative. India, he argued, may place itself as a world pioneer in sodium-based vitality storage or deal with superior chemistries similar to nickel-manganese-cobalt (NMC) and solid-state applied sciences to enhance vitality density and security.

India as the subsequent China+1 hub?

Within the context of the worldwide realignment of provide chains, what the world now refers to because the “China+1” technique, Palmer believes India is in a primary place to learn. Multinational firms are actively seeking to de-risk their dependence on Chinese language suppliers, and India has a number of structural benefits.

A big home market, aggressive labour prices, and a deepening vendor ecosystem gives fertile floor for brand spanking new investments. The nation has already attracted over $5 billion in international direct funding into auto parts over the previous two years, doubling the earlier five-year common.

Nevertheless, Palmer cautioned that India should convert these macro benefits into centered functionality constructing in areas like EV platforms, vital supplies processing, and value-added localisation.

“India has the chance to both copy from the West and enhance, or go its personal means. Nevertheless it should act with intent,” he stated.

Software program as a strategic benefit

Past {hardware}, Palmer believes one in all India’s most underappreciated strengths is its deep expertise pool in software program and digital applied sciences. Because the automotive business strikes in the direction of software-defined automobiles, the place every little thing from engine calibration to infotainment is run by code, India can lead.

“Outline the automobile of the longer term in the identical means China did ten years in the past. That’s the place you discover your area of interest,” he stated.

Its $150 billion IT export ecosystem, headquartered in cities like Bengaluru and Pune, provides it an edge in embedded software program, AI integration, and over-the-air replace capabilities. Palmer urged Indian OEMs and startups to pivot their software program focus away from enterprise methods like ERP or SAP and towards automobile intelligence and consumer interface design.

Collaboration, not silos

Whereas India’s potential is broadly acknowledged, Palmer believes the nation should now take the tough however obligatory step of constructing higher institutional collaboration.

“The Chinese language are actually good at aligning authorities, business, and academia. India must work tougher at working collectively, however the rewards are value it,” he stated.

In contrast to China’s one-party mannequin, India’s democratic setup requires consensus, agility, and long-term imaginative and prescient to execute daring strikes. To that finish, Palmer sees the necessity for a extra built-in method, one the place nationwide and state governments align on EV coverage, academia accelerates battery R&D, and the non-public sector scales improvements into industrial deployment.

Palmer’s message to India’s automotive sector is obvious and uncompromising. The nation can both play catch-up or turn into a critical challenger to China within the international EV race. It has the market scale, it has the expertise, and it has the early indicators of coverage momentum. What it now wants is strategic dedication and a willingness to steer.

He concluded, “You’re at a turning level. You could be a quick follower or a fierce chief. India has all of the components if it chooses to behave with intent.”

  • Revealed On Jul 4, 2025 at 08:48 PM IST

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