Auto Parts Makers Reopen Capex Tap As Demand Visibility Improves

Indian auto component makers are stepping up capital expenditure as stronger vehicle demand, rising capacity utilisation and new orders improve visibility for the coming years.

The fresh investment cycle follows a period in which several suppliers focused on capital efficiency, debt reduction and better use of existing plants. Companies are now adding capacity for electric-vehicle components, safety systems, electronics, and new customer programmes.

Uno Minda Allocates ₹1,750 Crore for Growth and New-Age Tech

Uno Minda has announced one of the largest investment plans among domestic suppliers. It plans to spend about ₹1,750 crore in FY27. Of this, around ₹1,100 crore will be growth capex and ₹650 crore will be used for sustaining investments. The remaining amount will be spent on land.

“For FY27, we have planned a total capital expenditure of approximately ₹1,750 crore,” Group Chief Financial Officer Sunil Bohra said during the company’s Q4 FY26 earnings call.

The company may also acquire land in Chennai, Hosur, and Gujarat to support expansion plans announced or under consideration by its customers.

Seven of Uno Minda’s 11 ongoing projects are expected to start production or ramp up during FY27. The company also plans to begin commercial operations in two new product segments — EV powertrains and sunroofs.

Its FY27 investments follow the capex of ₹1,572 crore in FY26. This included ₹861 crore for expansion projects and ₹149 crore for land acquisition.

The company is investing in new-age products as automakers add more electronic content and features to vehicles. Uno Minda is setting up a new facility in Maharashtra for four-wheeler EV components. The project involves an estimated investment of ₹550 crore over two to three years.

It is also building a sunroof plant and has secured orders with a potential annual peak value of more than ₹350 crore.

Motherson Maintains High Investment Rate

Samvardhana Motherson International Ltd expects to spend about ₹6,000 crore, with a variation of 10% on either side, in FY27.
Half of the planned amount will be used for growth projects. The balance will go towards maintenance investments.

“For FY27, we expect capex of approximately ₹6,000 crore, plus or minus 10%. Of this, 50% will be growth capex and 50% maintenance capex,” Group Chief Financial Officer Gandharv Tongia said.

The company spent ₹5,911 crore in FY26. Its investments were directed towards new projects, backward integration and maintenance.

Motherson has 16 facilities under development globally. Of these, 13 are expected to start operations during FY27. The company has also announced four new facilities, including two for wiring harnesses and two for its logistics business.

The investment is supported by an order book of $96 billion. About 22% of the order book comes from EV programmes. The company is also directing a larger share of growth spending towards emerging businesses such as consumer electronics.

“For the full year FY26, we maintained capex discipline in line with the guidance, with investments largely directed towards future growth and new capabilities,” Chairman Vivek Chaand Sehgal said.

Schaeffler Raises Spending After Moderation

Schaeffler India plans to increase capex to around ₹400-500 crore in CY26 after rationalising spending last year.

“Last year, we had rationalised a little bit. But this year, again, we will be picking up and going in that range of ₹500 crore,” Director of Finance and Chief Financial Officer Hardevi Vazirani said.

The company had moderated investments to focus on capacity utilisation and capital efficiency. It will now align new spending with customer programmes and future product demand.

Managing Director and Chief Executive Officer Harsha Kadam said the moderation did not imply a cut in the company’s long-term investment plans.

“While we have judiciously moderated our capex spend, looking at the market demand and portfolio demands, it does not mean that we are going to cut down our capex,” he said. “As the customers’ projects begin to take and evolve, we are going to continue our investment initiatives.”

The company is expanding capabilities across automotive and industrial businesses. It is also increasing localisation as India becomes a competitive manufacturing base for the wider Schaeffler group.
Safety rules drive capacity additions.

Endurance Tech Expands Braking and Safety Components Capacity

Endurance Technologies is expanding capacity in braking systems, driven by customer demand and the expected extension of anti-lock braking system requirements to smaller motorcycles.

The company is adding an annual capacity of 1.2 million ABS units to its existing capacity of 640,000 units. Production from the expanded capacity is expected to begin in September 2026.

Endurance said it would proceed with the investment even if the final regulation changes. It expects rising customer preference for safety to support ABS adoption.

The company is also preparing a new brake assembly plant in Chennai. The facility will have the capacity to produce three million disc brake assemblies and four million brake discs annually.

Production for Royal Enfield is expected to begin in July, followed by programmes for other automakers in the second quarter of FY27. The company has also ordered a new surface-mounted technology line for producing ABS electronic control units and battery management systems.

Bharat Forge, Varroc Pursue Growth Opportunities

Bharat Forge expects its ongoing investment programmes across forging, casting and product platforms to result in capex of ₹800-850 crore over the next 15-18 months.

The company expects its Indian manufacturing operations to grow strongly as new orders move into production.

Varroc Engineering has not provided a fixed capex number. However, its management said it would invest to capture growth opportunities while remaining mindful of debt.

“Whatever capex is needed, we are definitely going to incur that kind of capex for growth reasons,” Group CFO Mahendra Kumar said.

A large part of Varroc’s order book is linked to e-mobility and components supplied for EV programmes. Its investments will therefore be directed towards EV-linked businesses and capacity expansion required by customers.

Record Vehicle Sales Improve Visibility

The new spending plans follow a strong recovery in the domestic automobile industry during the second half of FY26.

Passenger vehicle sales reached a record 4.64 million units in FY26, while two-wheeler sales rose to 21.7 million units. Commercial vehicle sales increased to 1.08 million units. All three segments posted growth over the previous year.

The recovery has improved order visibility for suppliers. It has also raised demand for higher-value components as customers move towards SUVs, premium motorcycles, electric vehicles and feature-rich models.

Government support for advanced automotive manufacturing has added to investment momentum. The production-linked incentive programme for automobiles and auto components had attracted cumulative investments of ₹35,657 crore by September 2025.

Still, the investment cycle remains selective. Companies are linking new capacity to firm customer orders and product programmes. They are also watching commodity inflation, interest costs and geopolitical disruptions.

The shift is therefore not a return to indiscriminate capacity creation. Suppliers are directing capital towards areas where they see clear demand–safety, electrification, electronics, premiumisation and localisation.