By Falko Feldchen, VP – Procurement at o9
India’s automotive sector is undergoing one of its most significant transitions. Sustainability mandates, rising localisation requirements, and frequent supply chain disruptions are reshaping how automakers design, source, and manufacture vehicles. At the same time, the scale and fragmentation of India’s multi-tier supplier ecosystem are forcing OEMs to rethink their operating models, placing far greater emphasis on visibility, coordination, and collaboration across every tier of the value chain.
From sudden tariff changes to extreme weather events, disruptions move fast, and their effects cascade through multiple supplier tiers long before they appear on a dashboard. Yet, despite operating in one of the world’s most dynamic automotive markets, many Indian manufacturers still lack the visibility and shared intelligence needed to respond proactively.
The Cost of Disconnection in India’s Supplier Network
Most Indian OEMs have invested in supplier portals, digital quality systems, or custom-built ordering tools. However, these systems rarely “talk” to one another. Suppliers – especially Tier-2 and Tier-3 units – are left juggling fragmented interfaces, spreadsheets, and inconsistent data requirements. This disconnect typically manifests in three ways. First, visibility remains fragmented across tiers, particularly in regions with dense MSME supplier networks. Second, trust in data sharing is low, as suppliers often hesitate to disclose capacity or quality information for fear of being penalised. Third, lower-tier disruptions are detected late, leading to delayed responses and limited options for OEM planning teams. Whether it is a machine breakdown, a raw material delay, or a quality deviation, issues surface too late in the system, leaving minimal room to respond.
Trade policies further amplify these challenges. Even modest changes in duties on EV components or
battery materials can reshape sourcing decisions and alter production volumes, creating ripple effects across suppliers already operating on thin margins. Without real-time visibility into multi-tier dependencies, teams often recognise the impact only when assembly lines begin to slow. What the industry lacks is not digital tools, but shared context across the network – a foundation that allows partners to plan together rather than react in isolation, and to optimise the supply chain collectively.
A New Collaborative Model
Across global automotive supply chains, there is a growing shift towards open, interoperable data-sharing frameworks. Initiatives such as Catena-X demonstrate how common standards can enable secure and traceable data exchange across the value chain, allowing OEMs and suppliers to operate from a single source of truth. While each market has its nuances, these models offer valuable lessons for countries with complex, multi-tier supplier networks, illustrating how shared standards can strengthen collaboration, visibility, and resilience.
For India, such frameworks provide a useful reference point for addressing long-standing structural challenges. Shared data standards can simplify participation for fragmented MSME supplier bases by
reducing onboarding complexity and extending visibility beyond Tier-1. They also help tackle inconsistent and non-standard data practices by introducing common models for quality, capacity, sustainability, and traceability. This creates a unified language across OEMs, suppliers, logistics partners, and regulators as India’s export footprint expands.
With more consistent data signals flowing across tiers, OEMs gain the ability to simulate scenarios, model sourcing options, and detect risks earlier – shifting from reactive disruption management to proactive, predictive planning.
Rebuilding Trust Across the Supply Chain
Technology alone is not enough. True collaboration is built on trust, and that remains a structural challenge in India’s automotive supply chains. Many suppliers have faced situations where transparency led to renegotiated contracts, reduced volumes, or increased reporting burdens. Such experiences understandably make them cautious about sharing real-time data on capacity, risks, or delays.
A future-ready collaboration model must address these concerns directly. It requires clear guidelines
on how shared data will be used, a focus on mutual value rather than one-sided visibility, and consistent engagement that extends beyond quarterly reviews. Most importantly, it calls for outcomes-based collaboration, where early risk signals are rewarded rather than penalised.
What’s Next for India’s Automotive Sector
As India positions itself for global leadership in EVs, exports, and advanced manufacturing, the need for deeper multi-tier visibility, open standards, and stronger supplier alignment will only intensify. The organisations that move ahead will not simply be those with the most sophisticated digital tools, but those with sharper visibility across suppliers, faster simulation and response capabilities, and deeper trust across their ecosystem.
The next phase of India’s automotive resilience will rest on shared decision-making, standardised data sharing, and aligned incentives, rather than isolated planning within silos. While global frameworks mark an important milestone, the real transformation will occur when OEMs, suppliers, and policymakers view collaboration as a source of competitive advantage, not merely a compliance requirement.
