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Automotive and mobility

As automotive growth turns to South Asia, capability becomes the product.

By Founder & Principal Prabha Shankar ·

PwC’s Global Automotive Outlook 2026 finds the industry’s growth map moving east. The share of automotive executives naming South Asia as one of their top three growth regions rises from 24% today to 45% by 2030, while Western Europe falls from 44% to 26%. PwC also reports that Indian respondents are particularly inclined to build capability through acquisitions, licensing and public-private partnerships, and that Indian automakers plan acquisitions at roughly twice the global average rate.

For a technology owner or supplier, that changes the question. It is no longer only whether to sell into India, but on what terms its capability should enter: under licence, through a joint venture, with local production, or by direct supply. Those are the decisions to which Fractionova brings AI-native Opportunity Intelligence and principal-led judgement.

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Global Automotive Outlook 2026 is published by PwC. Released in September 2026, it draws on a survey of 720 director-level and senior executives at vehicle makers and Tier 1 suppliers in 33 countries across North America, Europe, Asia and the Middle East, conducted in March and April 2026. Figures are PwC’s and reflect what respondents report and expect; the interpretation is Fractionova’s. Fractionova is not affiliated with PwC.

Where do automotive executives expect growth?

By 2030Today

South Asia

45%
24%

Southeast Asia

44%
31%

Western Europe

26%
44%

Share of executives naming the region among their top three growth regions. South Asia shows the largest rise.

PwC, Global Automotive Outlook 2026 · % of respondents · 720 companies

Four shifts at once

PwC describes an industry in which the product, the customer, the competitor and the powertrain are all changing at the same time. Each shift is expected to play out over the next five years.

The product

Software, digital services and data are becoming a primary source of value. The median share of companies using advanced technologies to a large or very large extent across the value chain is expected to rise from 47% to 72%. 51% rank AI among the three technologies most important to their strategic goals, ahead of batteries and electric powertrains (41%).

Median share using advanced technologies to a large or very large extent, across value-chain activities

The customer

Executives expect a third of revenue (33%, up from 21%) to come from new kinds of customers within five years: commercial fleet operators, mobility service providers and governments. Among Tier 1 suppliers, the share naming traditional vehicle makers among their top three revenue sources falls from 77% to 61%.

Tier 1 suppliers naming vehicle makers as a top-three revenue source · %

The competitor

Traditional incumbents remain the main competitive force (63%), but 46% of executives now name new entrants from adjacent industries, especially technology and energy companies, as a source of competition. In China the figure is 52%; in the US, 32%. Executives also expect technology companies to replace industrial manufacturers as their most important collaborators.

The powertrain

Battery-electric vehicles and their components are expected to grow from 18% to 30% of production within five years, and internal combustion from 60% to 41%. The pace differs sharply: in China, battery-electric is expected to reach 40%, while in the US internal combustion is still expected to be the majority of production (51%) in 2030.

Share of production volume, global average of respondents’ expectations · %

A note on the figures: these are the expectations of executives at vehicle makers and Tier 1 suppliers, weighted so each company counts once. They describe where the industry expects to go, not measured outcomes.

India is buying capability

PwC’s country analysis covers China, Germany, India, Japan and the US. Its India finding is the one with the most direct consequence for companies outside India.

Building the new business from the ground up

PwC reports that Indian respondents show a high propensity for acquisitions, licensing and public-private partnerships as ways to build capability, and that Indian automakers plan acquisitions at roughly twice the global average rate. In India, it notes, electrification, urbanisation and the growth of commercial fleets are unfolding at once, and without a heavy legacy portfolio to defend, Indian automakers are in many segments building the new business from the ground up.

Europe looks outward

The share of all executives naming Western Europe as a top-three growth region falls from 44% to 26%. Among German respondents it falls from 78% to 48%. For European suppliers, growth increasingly sits outside the home market.

German respondents naming Western Europe as a top-three growth region · %

Investment points to new products

68% name R&D and product development among their top three investment areas over five years, ahead of manufacturing and operations (61%) and digital platforms and data (45%). PwC notes that manufacturing investment remains mostly aimed at productivity and efficiency (73%), with only 12% aimed mainly at growth and market share.

New collaborators

64% of executives are pursuing participation in wider ecosystems of technology, energy and mobility partners, the most frequently cited strategic move. Within PwC’s top 20% of companies, which it classes as “future-fit”, the share is 80%.

PwC does not publish India’s results on every question in the text of its findings; this page uses only the figures PwC states.

What changes for a technology owner

A shift in the market matters commercially when it is connected to a specific business. For a technology owner or supplier weighing India and other growth markets, these are the questions Fractionova would put first, organised by the dimension of the opportunity they affect.

Customer demand

New buyers, not only new markets

Executives expect a third of revenue to come from fleet operators, mobility service providers and governments, and Tier 1 suppliers expect to depend less on vehicle makers.

The decision

Which new buyer types in our target market need what we make, and who specifies and purchases it?

Partners & counterparties

Capability is being bought, licensed and partnered

PwC reports a high propensity for acquisitions, licensing and public-private partnerships among Indian respondents, and expects technology companies to become the industry’s most important collaborators.

The decision

Which Indian manufacturer, partner or programme could carry our technology, and what would each party contribute?

Economics & commercial potential

Returns and options

PwC advises adding a second lens to capital allocation: funding specific strategic options whose return is not yet visible, alongside the highest-return initiatives of today.

The decision

What return would a licence, a joint venture or local production each generate, and which keeps the most value with the technology owner?

Policy & geostrategic conditions

The cost of location differs

PwC finds that the same strategic move carries different costs and timescales in different markets, and advises companies to price their own location before committing. US respondents name tariffs as their top threat (42%).

The decision

Which incentives, localisation expectations and trade terms apply to our product in India, and how do they change the economics of each route?

Technology & capability

Know-how is the asset

Licensing or co-developing in a growth market means sharing know-how. PwC’s future-fit companies are ahead on software and AI capability (71% against 45%) and on partnership management (75% against 56%).

The decision

Which capabilities can be shared under licence, which must stay with us, and how is the value protected?

Timing & market readiness

A runway, not a destination

PwC describes established products as a runway that funds the transition, and warns against treating the runway as the destination. Electrification and new customer segments are arriving together in India.

The decision

Is this the moment to commit capability to India, or to secure a partner now and scale once a programme is confirmed?

Decisions this page is written for

Bring the question in the form your board would ask it.

Fleets and mobility providers are becoming customers. Which of them can we serve, and how?

Decision Sprint

License, partner or supply?

This is a hypothetical illustration, not a client engagement or a claim of achieved outcomes.

A German Tier 1 supplier makes thermal-management systems for electric vehicles. Its home market is flattening, and two Indian vehicle makers have approached it: one wants a technology licence, the other a joint venture with local production. Its leadership needs to decide how its capability should enter India.

Fractionova’s AI engine would connect programme demand and buyer commitments with partner capability, the economics of each structure, localisation and trade conditions, and the protection of know-how. Principal-led review would establish which route supports the next commitment and what evidence would justify it.

Local manufacturing as a strategic option

A

License the technologyGrant an Indian manufacturer the right to produce under licence, for fees and royalties. The questions are which know-how transfers, how royalties are protected and what the licence allows beyond India.

B

Form a joint venture with local productionShare investment and control with an Indian partner. The questions are the volume that justifies it, who funds tooling and qualification, and who controls the technology roadmap.

C

Supply direct with local engineeringKeep production at home and add an engineering and service base in India. The questions are landed cost, duties and whether buyers will accept imported supply as volumes grow.

See also the hypothetical Automotive Performance assessment

Three ways to commission the intelligence

You do not need to choose a format first. The starting point is the decision your business needs to make.

Decision Sprint

Concentrated intelligence for a consequential choice.

A focused investigation around a defined decision, culminating in a decision brief with the recommended direction, unresolved questions and conditions for commitment.

For example: Decide between a licence, a joint venture and direct supply for India before responding to a partner’s proposal.

Market & Partner Mission

A coordinated mandate to develop market access and commercial relationships.

An integrated investigation into market priorities, entry structures and counterparties, with prioritised partners and preparation for engagement.

For example: Qualify Indian manufacturers and fleet customers for a new product line, and prepare engagement.

Fractionova Intelligence Office

A retained intelligence capability around your strategic agenda.

Recurring investigation and monitoring, supported by agreed business context and structured principal-led reviews.

For example: Track programme announcements, policy incentives and partner moves across India’s automotive market.

Principal-led, AI-native

Founder & Principal Prabha Shankar leads the technical-commercial judgement behind Fractionova’s work. An engineer and international business specialist, he brings nearly three decades of experience across automotive engineering management, advanced mobility, new energy, international market development and complex programme execution.

At Fractionova, that experience shapes the questions put to the AI engine, the assumptions challenged during investigation and the commercial significance assigned to its findings.

ExperienceIndia, Europe and the Gulf, with automotive companies, institutions and government stakeholders
MotorsportSecretary of the Event for three editions of the Formula One Indian Grand Prix
EducationElectrical & Electronics Engineering; postgraduate study at Stevens Institute of Technology

Questions this page answers

What does PwC’s Global Automotive Outlook 2026 find?

PwC surveyed 720 executives at vehicle makers and Tier 1 suppliers in 33 countries in March and April 2026. It describes four simultaneous shifts, in the product, the customer, the competitor and the powertrain, and finds that many companies rate themselves well run while investing mainly for efficiency rather than growth.

Where do automotive executives expect growth?

The share naming South Asia among their top three growth regions rises from 24% today to 45% by 2030, and Southeast Asia from 31% to 44%, while Western Europe falls from 44% to 26%. These are executives’ expectations, not forecasts of market size.

What does the report say about India?

PwC reports that Indian respondents show a high propensity for acquisitions, licensing and public-private partnerships to build capability, and that Indian automakers plan acquisitions at roughly twice the global average rate, building new businesses in many segments from the ground up.

Who are the industry’s new competitors and partners?

46% of executives name new entrants from adjacent industries, especially technology and energy, as a source of competition, and they expect technology companies to replace industrial manufacturers as their most important collaborators within five years.

How does Fractionova help?

Fractionova brings AI-native Opportunity Intelligence and principal-led judgement to automotive and mobility decisions: which market to prioritise, which partner to engage, and whether to license, form a joint venture, produce locally or supply direct.

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All perspectives

Bring the decision that deserves deeper intelligence.

A licence to price. A partner to qualify. A growth market to prioritise. A local base to evaluate.

Start with what you are considering, what is at stake and what you need to determine.

Start a Decision

Sources and notes. Figures are from PwC, Global Automotive Outlook 2026 (September 2026): a survey of 720 director-level and senior executives at automotive OEMs and Tier 1 suppliers in 33 countries across North America, Europe, Asia and the Middle East, conducted in March and April 2026, with responses weighted so that each company counts once. Figures are taken from PwC’s research page and its interactive sections “The four shifts” and “Emerging advantage”, and from PwC’s press release of 24 September 2026. “Future-fit” is PwC’s classification of the top 20% of respondents on a composite of innovation, speed to market, strategic agility and access to capital. Growth-region figures are the share of respondents naming a region among their top three. Fractionova is not affiliated with PwC.

Fractionova equips clients with intelligence and considered recommendations to inform their decisions. Investment and implementation decisions remain with the client; execution and outcomes depend on the organisations involved and prevailing conditions.

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