India has the 4th largest automotive industry in the world with an aspiration of becoming 3rd largest till 2026. Our automotive sector contributes 7.1% of total GDP and also generates employment for 35 million people. The automotive industry also plays a major role among the services of outsourcing in India including CAD outsourcing, CAM outsourcing, engineering services, etc.

The automotive industry of India does not just contribute to the internal economy through direct production but also contributes through various services offered to MNCs by various product design companies in this field. Let’s discuss the automotive industry from the aspect of product design companies and outsourcing in India.Automotive industry and outsourcing in India

Since globalization, the Indian automotive industry has contributed a huge amount to the services of outsourcing in India. Availability of educated and trained labor along with developing infrastructure made India, the top choice of foreign companies for automotive outsourcing.

Due to increased labor costs and shorter product cycles, the automobile industry of the US and Europe is facing intense competition. That’s why Original Equipment Manufacturers [OEM] are heading towards India and China for outsourcing services. The growing international conflicts and competition has also boosted outsourcing in India because many countries are planning to shift their supply chains, from their initial suppliers, to India.

The largest share of outsourcing in India is held by the engineering and technical services sector which is around 38%. It is very beneficial for CAM/CAD outsourcing companies and product design companies along with engineering service companies like Infosys, Satyam along with automotive giants like Tata and M&M. Large companies like Ford are also setting R&D facilities in India.