India Automotive Compressor Market Assessment, By Compressor Type, By Vehicle Type, By Drive Type, By Sales Channel, By Region, Opportunities and Forecast, FY2018-FY2032F

India automotive compressor market is projected to witness a CAGR of 6.50% during the forecast period FY2025-FY2032, growing from USD 1.16 billion in FY2024 to USD 1.92 billion in FY2032. The market has experienced significant growth in recent years and is expected to maintain an expansion in the coming years owing to a considerable increase in requirement for electric vehicles, the growing popularity of electrically powered air conditioning systems, stringent government regulations on vehicle emissions, and increased demand for climate control and comfort features. The Indian automotive compressor market demand is expected to rise owing to the continuous shift toward electrification, surging investments in different research and development to enhance the performance of compressors, and increasing applications of compressors in all types of vehicles. The key drives, including continuous upgradation and advancements in the automotive industry coupled with a significant rise in requirement for energy-efficient compressors, are projected to foster the India automotive compressor market growth in the forecast period. Furthermore, the growing sales of passenger cars in India, growing customer preferences for energy-efficient vehicles, and expansion in the aftermarket sector are projected to result in different market growth opportunities for market players. According to data from the Federation of Automobile Dealers Associations, passenger vehicle (PV) retail sales reached a record high in FY2024, with a total of 3,948,143 units sold. This figure represents an 8.45% increase compared to the 3,640,399 units sold in the financial year 2023 (FY2023).

Companies in the market are significantly advancing the technologies of automotive compressors in terms of performance and efficiency to make air conditioning systems cost-effective, which further drives the India automotive compressor market growth in the forecast period. Also, companies in the Indian automotive compressor market are launching advanced compressors to offer overall safety and better driving experience to end-users.

For instance, in May 2022, MAHLE GmbH announced the introduction of its most powerful e-compressor with a peak power of 18 kW for thermal management in electric vehicles. MAHLE GmbH secured numerous orders in the commercial and passenger vehicle sector, and it is projected that the total order volume is nearly USD 1.48 billion.

Expansion of the Automotive Market Drives the India Automotive Compressor Market Demand

In India, the rapid growth of the automotive market is a key driver for the automotive compressor market growth. Key drivers, including rising disposable income, surging urbanization, and expanding infrastructure, are increasing vehicle requirements, further propelling the India automotive compressor market size in the forecast period. As a huge number of customers demand passenger cars and other products, the production of passenger vehicles and two-wheelers is accelerating, boasting the need for automotive compressors for various applications. For instance, according to the Society of Indian Automobile Manufacturers, from April 2022 to March 2023, the industry manufactured a total of 25,931,867 vehicles, encompassing passenger vehicles, commercial vehicles, three-wheelers, two-wheelers, and quadricycles. This marks an increase compared to the 23,040,066 units produced during the previous year, from April 2021 to March 2022. This growing requirement for vehicles motivates manufacturers to improve their production capabilities and invest in new technologies. Furthermore, the expansion of the automotive sector introduces different market growth opportunities for aftermarket sales, including replacement and maintenance of compressors, which can sustain demand for the long term. This market trend strengthens the automotive compressor market growth in the forecast period. Also, the Indian government issued new guidelines that are expected to increase the demand for automotive compressors in India and enhance the overall driving experience.

For instance, in December 2023, the Indian Ministry of Road Transport and Highways issued a notification that states that all trucks manufactured from October 2025 onwards must have factory-fitted AC cabins.

Growing Consumer Awareness of Comfort Features Propels the Market Growth

The rising emphasis on convenience and comfort in vehicles significantly impacts the requirement for automotive compressors in India. Climate control and easy accessibility of air conditioning systems in automotive make automotive compressors an essential component that further drives the automotive compressor market in India. With an increase in disposable income coupled with rapid urbanization, more buyers prefer vehicles that offer superior comfort and convenience, specifically in extreme weather conditions. Thereby, manufacturers are investing in different research and development activities to advance the performance of automotive compressors to offer rapid cooling and precise temperature control, driving the India automotive compressor market growth in the forecast period. In addition, enhanced cabin air quality systems are becoming a focal point, leading to the incorporation of advanced filtration and compressor technologies. This trend fosters sales and motivates the development of innovative compressor solutions personalized to consumer preferences. Companies in the market plan to announce collaboration to expand their market presence and bring a wider range of products.

For instance, in November 2024, Honda Motorcycle & Scooter India Pvt. Ltd. announced the introduction of its first V3 motorcycle engine with an electrical compressor to expand its product lineup and meet the diversifying requirements of today's customers.

Passenger Cars Dominate the India Automotive Compressor Market Share

Passenger cars hold a significant share of India automotive compressor market owing to rising requirements for personal vehicles, growing focus on comfort features among consumers, and innovations in air conditioning technology. As the disposable income of consumers is rising and urbanization continues, more individuals are investing in passenger cars, leading to a higher requirement for reliable and efficient compressors. In addition, a significant advancement in compressor design and performance focused on enhancing energy efficiency and reducing carbon emissions surged the demand for automotive compressors in passenger cars. Overall, the robust performance of the passenger car market significantly propels the growth of India automotive compressor market.

For instance, in June 2022, Garrett Motion Inc. announced its latest development of a next-generation electric compressor to expand the company's presence in the rising mild and full hybrid passenger vehicle segment.

North India is Expected to Dominate the India Automotive Compressor Market Size

North India is projected to lead the automotive compressor market size owing to different key factors, including rapid urbanization and industrialization in cities such as Chandigarh, Delhi, and Jaipur, as well as an increase in disposable incomes and a growing population. In addition, the growing demand for personal and commercial vehicles, as well as the presence of key automotive manufacturers coupled with suppliers, are anticipated to drive the need for automotive compressors. In addition, the growing focus on electric vehicles is also gaining traction across this region, which is also fostering the demand for automotive compressors. Furthermore, companies in the market are efficiently advancing the performance and durability of automotive compressors to be competitive and offer comfort to drivers and passengers.

For instance, in September 2023, Brose Fahrzeugteile SE & Co. KG, a leading company in India's automotive compressor market, developed a high-voltage compressor with 800 volts of operating voltage that enables fast charging of EVs. The electric climate compressor ensures efficient air-conditioning of the interior and cooling of the vehicle battery.

Future Market Scenario (FY2025-FY2031F)

Growing electric vehicle adoption necessitates advanced compressors, creating new opportunities in the automotive compressor sector.

Rapid urbanization increases vehicle ownership, increasing demand for efficient automotive compressors in passenger and commercial vehicles.

Supportive government policies and incentives for the automotive industry foster growth, encouraging investment in compressor technologies.

Growing awareness of environmental issues drives demand for eco-friendly compressors, aligning with global trends toward sustainability in automotive technology.

Key Players Landscape and Outlook

Companies in the market significantly invest in different research and development activities to ensure the high performance and durability of automotive air conditioning compressors. Companies are also investing in expanding their manufacturing capabilities in India to meet the growing demand for both conventional and electric vehicle compressors. Key participants are improving its R&D facilities in India to develop innovative compressor technologies, catering to the rising EV market, and expanding its product offerings. Furthermore, companies are expanding their product portfolio to include eco-friendly compressors and are investing in new manufacturing facilities to increase the manufacturing output.

In January 2023, Hanon Systems, a leading company for automotive compressors in India that operates four plants in India - Chennai, Sanand, Pune, and Bhiwadi, announced the establishment of its automotive compressor plant in Palmela, Portugal, to address the rising demand for automotive compressors from the automotive industry.