Lumax Auto Technologies opted out of the PLI scheme for auto components due to low demand visibility and emerging supply chain challenges.
Vikas Marwah, CEO of Lumax Auto Technologies, disclosed that his company voluntarily gave up its pursuit of Production Linked Incentive (PLI) benefits approximately two years ago despite being selected under the auto components segment, citing uncertain demand visibility and supply chain challenges.
Speaking at a panel discussion on building the EV value chain at Autocar Professional's India EV Conclave, Marwah explained the rationale behind the unusual decision. "We realized that even if we spent several crores on it, we did not see when the demand visibility would emerge. Secondly, there were supply chain challenges that were emerging. So we went back to the drawing board and decided to focus on remaining fuel agnostic in our product portfolio."
The decision reflects the pragmatic challenges facing component manufacturers in India's uncertain EV landscape, where policy support exists but market demand remains volatile.
Despite abandoning PLI benefits, Marwah reported remarkable growth for the company. "We have grown 5x in revenue over the past five years by focusing on the aggressive India strategy," he said, demonstrating that success is possible through alternative pathways.
Marwah outlined Lumax's strategic focus areas: "We are not into battery packs, motors...what we are focusing on is semiconductor resilience and that is where the pain lies." This focus on semiconductors – a critical bottleneck in the automotive supply chain – distinguishes Lumax's approach from competitors chasing battery and powertrain segments.
The company's strategy relies heavily on partnerships. "We collaborated and formed JVs with several Japanese companies. So, it is these partners who take care of the sourcing needs of many of these materials," Marwah explained, highlighting how strategic alliances can mitigate supply chain risks.
Lumax Auto Technologies has over 40 years of industry experience and operates 30 manufacturing facilities across 7 states with 2 advanced Engineering Centres, 9 global partnerships, and 1 technical agreement. The company has partnerships with automotive industry leaders including Cornaglia of Italy, Mannoh of Japan, JOPP of Germany, and several others.
The company stands out with its integrated approach, strong R&D capabilities, and is the sole domestic supplier of gear levers for electric vehicles, giving it a unique competitive position.
Marwah's comments about remaining "fuel agnostic" reflect broader industry concerns about betting too heavily on a single propulsion technology. The growing demand for hybrid vehicles presents a challenge, as consumers often seek familiar alternatives to fully electric models.
The PLI scheme for auto components, launched with an outlay of Rs 25,938 crore, was designed to promote domestic manufacturing and attract investments into the automotive value chain. However, Lumax's experience suggests that even with government support, uncertainties around demand and supply chains can make companies hesitant to commit large capital investments.
Marwah's frank admission highlights a critical policy challenge: while PLI schemes provide financial incentives, they cannot eliminate market uncertainties or supply chain vulnerabilities – factors that ultimately determine investment decisions for prudent companies.
The Lumax story underscores that in India's evolving mobility landscape, flexibility and strategic partnerships may be more valuable than chasing every available subsidy, particularly when market visibility remains unclear.
The India EV Conclave 2025 was presented by Chargezone, with Rosmerta Technologies as the Platinum Partner. The event is powered by IPG Automotive and Gulf Oil Lubricants India, with PTC serving as the Technology Partner. Associate Partners include Spark Minda, Radici Group, and Delta Electronics. The conclave also has trade partnerships with FADA, ASDC, and ICAT.