In the 1990s, the Indian automotive landscape was a study in transition. As the iconic but aging Hindustan Ambassador and Premier Padmini began to share the road with a new generation of vehicles from Maruti Suzuki and others, the factory floors were equally caught between two eras. Assembly lines relied heavily on conventional, manual tightening methods, with little in the way of the high-precision, data-linked tooling that defines modern manufacturing.
Today, India stands as a global automotive powerhouse, aiming for production volumes that would have seemed fantastical three decades ago.
Anchored in History
Atlas Copco, a Swedish multinational's entry happened amidst this transition, as it evolved from a mere provider of tightening tools into one of the leading architects of the "smart factory" ecosystem for automotive and other sectors in the country. The company's footprint in India dates back to 1960, though its early decades were primarily defined by its compressor business. The specialized entry into the automotive assembly space began through a local representative, Intel Tech Automation, in the 1990s. By the end of that decade, recognizing the burgeoning potential of the Indian market as global OEMs like General Motors and Ford arrived, the company established a full-fledged direct presence.
This entry coincided with a critical realization among Indian manufacturers: to compete internationally, they could no longer rely on localized, rudimentary standards. "If you want to produce vehicles as per the international standards, you really have to upgrade yourselves in terms of technology," notes Chandrashekhar Pathak, a 28-year veteran of the group and current head of the Industrial Technique business area in India. He spoke with Autocar Professional on the sidelines of the company's recent celebration of its Innovation Days 2026 in Pune.
Elgi Equipment, Ingersoll Rand, Stanley Black & Decker, Bosch, Montabert, Parker Hannifin, Ebara, Center Rock are some of the other key players competing in the segment. The presence of a large number of players, both big and small, is indicative of the massive opportunity size in the tooling industry. Industry data suggests that the Indian automation market is projected to hit $30 billion (Rs 2.4 Lakh Crore) by 2030, growing at a CAGR of 18.4% between 2024-2030 on account of the push given by PLI, EV shift, and ADAS mandates, with India auto capex hitting Rs 80,000 crore by 2026.
This represents a massive shift from just a decade ago, when automation was often viewed as a luxury rather than a survival imperative. In the next five years, within the Rs 8.3 billion capex by the auto companies, nearly 35-40% will be for automation. This surge is also being driven by a tightening labour market, where the wage advantage is narrowing by 4–6% annually, and a drastic reduction in ROI payback periods, which have dropped from 5–7 years in 2018 to under 3 years today.
The opportunity should be seen in the context that India currently possesses a robot density of just 94 robots per 10,000 workers, as per industry data. To put this in perspective, the global leaders are operating in a different stratosphere. South Korea leads the world with a density of 1,012 robots, followed by China at 470, Japan at 419, and Germany at 415. Even regional competitors like Thailand, with a density of 165, have significantly outpaced India in floor-level automation.
The implications of this gap are visible across several critical segments: While global benchmarks show 82% automation in the EV welding lines, India languishes at 38%. In the vision/ AI inspection, India’s 22% adoption rate is dwarfed by the global average of 74%. Likewise, in the robotic paint lines, India stands at 51% compared to a 91% global standard. Perhaps, digital twin technology, which is the most significant Emerging frontier, India has only 11% adoption against a global benchmark of 48%.
The Once-in-a-Lifetime Changes
The current state of the industry, however, is far removed from the linear growth of the 1990s or even 2000s. Pathak describes the present era as a “once-in-a-lifetime” phase, characterized by a simultaneous explosion of competing technologies.
"We have the internal combustion engine technologies, we are talking about EV, and we are talking about hydrogen-powered vehicles," Pathak explains. "When it comes to the automotive industry, I think this is perhaps the best time".
For Atlas Copco, navigating this transition has required an aggressive acquisition strategy to stay ahead of the curve. By integrating companies like ISRA Vision and Perceptron, the group has moved beyond simple tightening (joining) into vision systems and advanced dispensing technologies. This portfolio allows them to serve as an end-to-end partner for the complex needs of modern assembly, where a single line might need to accommodate multiple powertrain types.
While India’s leading OEMs have largely embraced high-level automation, a significant gap remains within the Tier 1 and Tier 2 supplier base. These suppliers are under immense pressure to increase scale and reliability to meet the high ambitions of the localization initiatives, yet the high capital expenditure of full automation remains a barrier.
To address this, players like Atlas Copco have been relying on a modular, scalable approach to automation. Rather than demanding a complete overhaul of a facility, the company provides solutions that allow a Tier 2 supplier or a Tier 3 supplier to start with basic smart tools and gradually integrate them into a wider digital ecosystem.
"It is up to the customer whether they want to go for a full-fledged complete solution or they can start off just with the tools and then they can scale up," Pathak says. This modularity is crucial for ensuring that the entire supply chain—not just the final assembly line—delivers products with the "right quality" and "reliability". This is particularly vital in a market where 80% to 90% of Industrial Technique’s business is inextricably linked to the automotive sector.
Smart Manufacturing
The modern Indian automotive plant is increasingly defined by Smart Integrated Assembly, a concept that moves the focus from the individual tool to the data it generates. In this software-driven environment, 'tightening' is just a very basic thing. The true value lies in torque traceability and error-proofing. In an era of high-volume production, a single improperly tightened bolt can lead to massive rework costs or, worse, safety recalls. By using software that communicates directly with the tools on the floor, manufacturers can ensure that every assembly step is performed the first time correctly.
Pathak emphasizes that this shift is also a sustainability imperative. "If you make any mistake... it’s a waste," he observes. "You're producing junk because then you might have to rework it. It’s a wastage of time [and] material". To mitigate this, Atlas Copco and its peers are increasingly relying on predictive maintenance solutions, which use data to anticipate equipment failure before it disrupts the production line. This level of integration creates a complete integrated ecosystem where the tool, the software, and the operator are in constant digital dialogue.
India, a Global Engineering Nerve Center
Perhaps the most significant indicator of India’s evolved role is the transition of Atlas Copco’s local operations from a sales and service branch to a Global Engineering Center (GCC).
With a total headcount exceeding 3,500 employees in India, including 300 dedicated specifically to the Industrial Technique business, the Indian operation now supports global projects far beyond its borders. This GCC is not merely for local adaptation; it is a hub where engineering solutions are developed for customers in Japan, Sweden, Germany, and South Korea.