L&T is expanding into EV component manufacturing with products such as traction motors, ADAS, and drive control units to capitalize on India's growing electric mobility market. The company is focusing on localization, with 98% of traction motor components sourced domestically, while targeting long-term growth through import substitution and rising EV demand.
Indian conglomerate Larsen & Toubro Ltd (L&T), which operates in the space of infrastructure and technology, is moving into the space of EV component manufacturing to leverage the rapid growth of electric mobility and demand for high-end automotive technologies.
L&T is entering the space of EV components along with other big Indian conglomerates like Tata Group, Mahindra Group and JSW Group to manufacture traction motors, drive control units and advanced electronics, which include the advanced driver assistance system (ADAS).
According to the company’s management, it has bagged a traction motor order from an electric two-wheeler manufacturer and is having discussions with passenger and commercial vehicle manufacturers.
"In mobility space, our objective is energy security. Energy security is extremely critical for any nation and electric mobility is one very good way of providing energy security," said Prashant Jain, Managing Director, Larsen & Toubro Vyoma, and Head of L&T Electronic Products & Systems.
Focus on Localisation and Import Substitution
L&T seeks to build domestic competence in EV components by becoming less reliant on imported parts, especially Chinese-made components. The firm has built ADAS solutions and motor controllers while concentrating on developing products that suit Indian climatic conditions.
A big strength for L&T will be the high degree of localization that it has managed to achieve. L&T has localized about 98% of the components used in the traction motor, which contribute 70% of the total cost of the motor. L&T intends to localize further.
L&T’s EV components will be produced at its plant in Coimbatore in Tamil Nadu. Local production is expected to help L&T compete with domestic manufacturers like Samvardhana Motherson and Sona Comstar, in addition to international rivals such as Bosch and Continental.
EV Growth Driving Demand for Premium Components
Increased popularity of high-end cars has been creating demand for technology solutions like ADAS. Due to higher penetration of electric vehicles in two-wheelers, three-wheelers and passenger cars, suppliers of components have been getting newer opportunities for growth.
Traction motor can be considered one of the key components of electric vehicles, which converts battery energy into vehicle motion. Traction motors use rare earth magnets and supply constraints have surfaced as China has started imposing export restrictions on heavy rare earth magnets.
L&T’s management pointed out that even though L&T’s products use heavy rare earth magnets but the magnets used by L&T are not included in China’s export license regulations, and hence there will be no problem in manufacturing.
Take a Look at L&T Quarterly Results Q1 2027
India Turns Net Importer of Auto Components Amid EV Boom
The growth in India’s EV market has seen an increase in the importation of automotive components. Sales of EVs grew by 29%, crossing 24 lakh units during FY26 while the number of electric models in two-wheelers, three-wheelers, and passenger cars saw considerable growth as per the information from the Vahan portal.
Imports of auto components during FY26 reached $25.4 billion, showing an increase of 13% year on year. Imports had risen by 7% in FY25 while exports were recorded at $24 billion, showing a growth of 5% compared to 8% growth in FY25, affected by tariff issues and the war in West Asia, according to the Automotive Component Manufacturers Association.
L&T Stock Reaction After EV Expansion Announcement
The venture into the business of making components for electric vehicles by L&T opens up an avenue that is likely to improve the company’s prospects of growth in the long run since it ventures into a new business area other than engineering and infrastructure. The news was not enough to make the company’s stocks react due to the fact that they would be monitoring the progress and success of the venture in future. List of L&T Group stocks
In addition to competing with the well-established component manufacturers, scalability and margins are the other aspects that will play an important role in the future growth of the company.
There are many Indian conglomerates investing in electric vehicles, but the only conglomerate having a scalable automotive component business is the Tata Group.
