{"id":8643,"date":"2026-06-13T15:19:04","date_gmt":"2026-06-13T09:49:04","guid":{"rendered":"https:\/\/www.entrepreneurindia.co\/blogs\/?p=8643"},"modified":"2026-06-13T14:46:52","modified_gmt":"2026-06-13T09:16:52","slug":"ev-component-manufacturing-business","status":"publish","type":"post","link":"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/","title":{"rendered":"Debt to Dollars: How a Tamil Nadu Engineer Quit His Job, Failed Twice, and Built a \u20b940 Cr EV Components Startup"},"content":{"rendered":"<p><strong><em>EV Component Manufacturing Business in India<\/em><\/strong><\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#The_Number_That_Changes_Everything\" >The Number That Changes Everything<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#India_Makes_the_Vehicle_It_Imports_the_Intelligence\" >India Makes the Vehicle. It Imports the Intelligence.<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Get_Detailed_Insights_from_This_Book_Handbook_on_Electric_Vehicles_Manufacturing\" >Get Detailed Insights from This Book: Handbook on Electric Vehicles Manufacturing<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Table_1_State-wise_EV_Demand_Key_Industrial_Clusters_for_EV_Components\" >Table 1: State-wise EV Demand &amp; Key Industrial Clusters for EV Components<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Why_the_Window_is_Still_Open_%E2%80%94_And_How_Long_It_Stays_That_Way\" >Why the Window is Still Open \u2014 And How Long It Stays That Way<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#View_Full_Project_Details_Battery_for_Auto_Vehicles\" >View Full Project Details: Battery for Auto Vehicles<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Setting_Up_an_EV_Components_Unit_A_Realistic_Step-by-Step_Guide\" >Setting Up an EV Components Unit: A Realistic Step-by-Step Guide<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_1_%E2%80%94_Define_Your_Component_Niche\" >Step 1 \u2014 Define Your Component Niche<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_2_%E2%80%94_Location_and_Space\" >Step 2 \u2014 Location and Space<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_3_%E2%80%94_Key_Machinery_and_Equipment\" >Step 3 \u2014 Key Machinery and Equipment<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_4_%E2%80%94_Raw_Material_Sourcing\" >Step 4 \u2014 Raw Material Sourcing<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_5_%E2%80%94_Licenses_and_Regulatory_Approvals\" >Step 5 \u2014 Licenses and Regulatory Approvals<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Step_6_%E2%80%94_Timeline_and_Team\" >Step 6 \u2014 Timeline and Team<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Discover_business_ideas_that_actually_make_money\" >Discover business ideas that actually make money<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Table_2_Investment_Breakdown_for_an_EV_Components_Manufacturing_Unit\" >Table 2: Investment Breakdown for an EV Components Manufacturing Unit<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Financial_Snapshot_What_the_Numbers_Actually_Look_Like\" >Financial Snapshot: What the Numbers Actually Look Like<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Table_3_Applicable_Government_Schemes_Eligibility_and_Benefits\" >Table 3: Applicable Government Schemes, Eligibility, and Benefits<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Getting_Your_Numbers_Right_Before_You_Start\" >Getting Your Numbers Right Before You Start<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Related_Article_Top_Electrical_Insulation_Manufacturing_Business_Ideas_in_India_Low_Investment_High_Demand_MSME\" >Related Article: Top Electrical Insulation Manufacturing Business Ideas in India (Low Investment, High Demand MSME)<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#ENTREPRENEUR_SPOTLIGHT\" >ENTREPRENEUR SPOTLIGHT<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Your_Next_Move_%E2%80%94_Make_It_in_the_Next_30_Days\" >Your Next Move \u2014 Make It in the Next 30 Days<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Frequently_Asked_Questions\" >Frequently Asked Questions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/www.entrepreneurindia.co\/blogs\/ev-component-manufacturing-business\/#Key_Data_Sources_Citations\" >Key Data Sources &amp; Citations<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"The_Number_That_Changes_Everything\"><\/span><strong>The Number That Changes Everything<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Ninety-four percent. This is India&#8217;s reliance on imports for sophisticated power electronics that power EVs such as motor controllers, on-board chargers, and battery management systems. The brain of an electric 2-wheeler that rolls out of any Pune factory, is almost surely Chinese or Taiwanese. The final assembly is done in India. The value is not.<\/p>\n<p>This number was known to Aravind Krishnamurthy before the EV boom became a reality for most others. He is a power electronics engineer from Tiruchirapalli, who worked for nine years with a Tier 1 auto ancillary company near Chennai, observing what happens as components are shipped through the supply chain \u2014 and every single time, the boxes with Chinese labels. He left his position of earning \u20b918 lakh per year, and tried his luck with two start-ups before setting up an EV components business with an annual revenue of \u20b940 crore in Hosur, Tamil Nadu, which has a built-up area of 12,000 sq ft. He employs 67 people. His OEM customers comprise three listed EV makers.<\/p>\n<p>This is not a love story. It is a tale of production planning, correctly timing a government scheme, and what a poor-drafted co-founder agreement cost. If you&#8217;re considering moving into EV components, read it! Read it particularly if you feel it&#8217;s too late.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"India_Makes_the_Vehicle_It_Imports_the_Intelligence\"><\/span><strong>India Makes the Vehicle. It Imports the Intelligence.<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>In the last complete fiscal year, India sold approximately 16 lakh EVs, according to the <a href=\"https:\/\/www.siam.in\/statistics.aspx?mpgid=8&amp;pgidtrail=14\" target=\"_blank\" rel=\"noopener\">Society of Indian Automobile Manufacturers (SIAM)<\/a>. This number is increasing at a rate of about 40% per year. But the domestic content narrative is lop-sided \u2013 the chassis, body panels and plastic trims are local, while the high-value electronics stack \u2013 motor controllers, inverters, BMS units, DC-DC converters \u2013 is far more imported.<\/p>\n<p>This has been identified by the <a href=\"https:\/\/heavyindustries.gov.in\/\" target=\"_blank\" rel=\"noopener\">Ministry of Heavy Industries<\/a>, in successive reviews of PLI scheme. Although India has near zero production capacity of IGBT modules, the local power devices industry is still limited in Sic-based power devices, and the local motor winding industry also has few players with the expertise to produce highly efficient PMSM motors in volume. The issue is structural, in that most of the MSME manufacturers have jumped on the two-wheeler bandwagon with body\/framed components and left the electronics to imports and a few big names.<\/p>\n<p>This is different for states. The supply chain gaps are the highest in the areas with the most concentrated EV OEM clusters: Tamil Nadu and Maharashtra. Ather Energy and Ola Electric are among the rising number of EVs in Karnataka, which is dependent on imports to make up the difference between what Tier-1 suppliers can manufacture and what the assembly lines require today. The three-wheeler EV market is growing very fast in Rajasthan and Uttar Pradesh, where there is virtually no roster of local component suppliers.<\/p>\n<h3 style=\"text-align: center;\"><span class=\"ez-toc-section\" id=\"Get_Detailed_Insights_from_This_Book_Handbook_on_Electric_Vehicles_Manufacturing\"><\/span>Get Detailed Insights from This Book: <a href=\"https:\/\/www.niir.org\/books\/book\/handbook-on-electric-vehicles-manufacturing-e-car-electric-bicycle-e-scooter-e-motorcycle-electric-rickshaw-e-bus-electric-truck-with-assembly-process-machinery-equipments-layout\/isbn-9788195676927\/zb,,18bdb,a,0,0,a\/index.html\" target=\"_blank\" rel=\"noopener\">Handbook on Electric Vehicles Manufacturing<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<h2><span class=\"ez-toc-section\" id=\"Table_1_State-wise_EV_Demand_Key_Industrial_Clusters_for_EV_Components\"><\/span><strong>Table 1: State-wise EV Demand &amp; Key Industrial Clusters for EV Components<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<table>\n<tbody>\n<tr>\n<td><strong>State<\/strong><\/td>\n<td><strong>EV Registrations (annual est.)<\/strong><\/td>\n<td><strong>Key Industrial Cluster<\/strong><\/td>\n<td><strong>Dominant Component Need<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Tamil Nadu<\/td>\n<td>~1,80,000<\/td>\n<td>Hosur, Chennai, Coimbatore<\/td>\n<td>Motor controllers, BMS<\/td>\n<\/tr>\n<tr>\n<td>Gujarat<\/td>\n<td>~1,60,000<\/td>\n<td>Sanand, Rajkot, Surat<\/td>\n<td>Charging connectors, inverters<\/td>\n<\/tr>\n<tr>\n<td>Maharashtra<\/td>\n<td>~2,10,000<\/td>\n<td>Pune, Nashik, Chakan<\/td>\n<td>Wiring harness, thermal mgmt<\/td>\n<\/tr>\n<tr>\n<td>Rajasthan<\/td>\n<td>~95,000<\/td>\n<td>Bhiwadi, Neemrana<\/td>\n<td>Two-wheeler motor assemblies<\/td>\n<\/tr>\n<tr>\n<td>Karnataka<\/td>\n<td>~1,10,000<\/td>\n<td>Bengaluru, Dharwad<\/td>\n<td>Power electronics, BMS units<\/td>\n<\/tr>\n<tr>\n<td>Uttar Pradesh<\/td>\n<td>~1,40,000<\/td>\n<td>Noida, Greater Noida<\/td>\n<td>Three-wheeler drivetrains<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2><span class=\"ez-toc-section\" id=\"Why_the_Window_is_Still_Open_%E2%80%94_And_How_Long_It_Stays_That_Way\"><\/span><strong>Why the Window is Still Open \u2014 And How Long It Stays That Way<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>According to estimates on the <a href=\"https:\/\/e-amrit.niti.gov.in\/\" target=\"_blank\" rel=\"noopener\">NITI Aayog&#8217;s e-Amrit portal<\/a>, India is expected to have a retail EV component market of \u20b91.2 lakh crore by the end of this decade. If the trend continues, most of that value will be swallowed by large conglomerates, or will continue to drain to the rest of the world. The window for MSMEs is short, a mere 3-5 years or so, before the market hits the stage of consolidation with a handful of players who are the Tier-1s.<\/p>\n<p>There are three distinct forces on the demand side which are pushing that toward new entrants today. To qualify for demand incentives from FAME-II and new advanced auto components PLI tranche, OEMs are actively looking to localise supply chains. Secondly, the Production Linked Incentive (PLI) Scheme for Advanced Chemistry Cell (ACC) Batteries and Auto Components provide cash incentives to the manufacturers of qualifying products ranging from 4\u201318% of incremental sales, which is a direct subsidy to growth. Thirdly, Chinese component costs have surged significantly, and Indian-made components are now competitive for the first time in fields such as motor controllers and charging modules.<\/p>\n<p>In the third year of Aravind&#8217;s Hosur plant, the plant has passed the PLI threshold. \u201cIf you properly set up your scheme, and don&#8217;t overestimate your base year production, then this incentive cheque is money. The message he was offering \u2014 stick with your base year production \u2013 would help him avoid falling into a pitfall that ensnared a number of competitors who overstated initial production and wound up not being eligible for incentives later on.<\/p>\n<p>There is more than PLI going for government support. <a href=\"https:\/\/www.cgtmse.in\/\" target=\"_blank\" rel=\"noopener\">Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)<\/a> allows collateral-free loans of up to \u20b92 crore for the first time manufacturers of MSMEs. The PMEGP scheme offers a capital subsidy of 25-35% for setting up a new manufacturing unit with a project cost of up to \u20b950 lakh. The three-year income tax holiday has a significant impact on the early-stage cash burden on startups under 10 years old that are recognized by DPIIT.<\/p>\n<h3 style=\"text-align: center;\"><span class=\"ez-toc-section\" id=\"View_Full_Project_Details_Battery_for_Auto_Vehicles\"><\/span>View Full Project Details: <a href=\"https:\/\/www.niir.org\/profile-project-reports\/profile\/3658\/battery-for-auto-vehicles.html\" target=\"_blank\" rel=\"noopener\">Battery for Auto Vehicles<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<figure id=\"attachment_8645\" aria-describedby=\"caption-attachment-8645\" style=\"width: 1200px\" class=\"wp-caption alignnone\"><img fetchpriority=\"high\" decoding=\"async\" class=\"size-full wp-image-8645\" src=\"https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90.jpg\" alt=\"EV Component Manufacturing Business\" width=\"1200\" height=\"1800\" srcset=\"https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90.jpg 1200w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-200x300.jpg 200w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-683x1024.jpg 683w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-768x1152.jpg 768w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-1024x1536.jpg 1024w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-150x225.jpg 150w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-750x1125.jpg 750w, https:\/\/www.entrepreneurindia.co\/blogs\/wp-content\/uploads\/2026\/06\/Untitled-design-90-1140x1710.jpg 1140w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><figcaption id=\"caption-attachment-8645\" class=\"wp-caption-text\">A modern EV components manufacturing facility producing motor controllers, BMS units and power electronics for India&#8217;s growing electric vehicle industry.<\/figcaption><\/figure>\n<h3><span class=\"ez-toc-section\" id=\"Setting_Up_an_EV_Components_Unit_A_Realistic_Step-by-Step_Guide\"><\/span><strong>Setting Up an EV Components Unit: A Realistic Step-by-Step Guide<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<h3><span class=\"ez-toc-section\" id=\"Step_1_%E2%80%94_Define_Your_Component_Niche\"><\/span><strong>Step 1 \u2014 Define Your Component Niche<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Never try and build the whole electronics package! Select one of the sub-categories: motor controllers (BLDC\/PMSM), on-board chargers, wiring harnesses for EV platforms, or BMS units. Before investing your money, perform market-test on 2-3 OEMs. Aravind began by making motor controllers for two-wheelers costing from \u20b93,500 to \u20b98,000 per unit and gross margin of 22 to 28% at volume.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_2_%E2%80%94_Location_and_Space\"><\/span><strong>Step 2 \u2014 Location and Space<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The basic unit requires at least 3,000-5,000 square feet of covered industrial shed area. Sheds are available for rent in Hosur (Tamil Nadu), Chakan (Maharashtra), Neemrana (Rajasthan) and Sanand (Gujarat) at rates of \u20b918\u201332 per sq ft per month, which are much lower than that in Bengaluru or Chennai city, and located within 50\u2013100 km of EV OEM clusters. Being close to OEM plants reduces logistics costs; a critical factor for Tier-1 qualification is a just-in-time supply.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_3_%E2%80%94_Key_Machinery_and_Equipment\"><\/span><strong>Step 3 \u2014 Key Machinery and Equipment<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The pieces of equipment that are essential for a motor controller manufacturing facility are: PCB SMT assembly line (semi-auto), pick and place machine, conformal coating machine, environmental stress screening chamber, functional test rigs (custom built to OEM spec). For a small unit, the total machinery cost is between \u20b935 to 45 lakh and for a mid-size, the additional amount of automation is estimated to be \u20b930 to 40 lakh. Most non-specialised equipment can be provided by Indian machinery suppliers from Pune, Coimbatore and Kolkata.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_4_%E2%80%94_Raw_Material_Sourcing\"><\/span><strong>Step 4 \u2014 Raw Material Sourcing<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Still, we require MOSFETs, IGBTs, gate drivers, microcontrollers etc. which are import dependent and have to be sourced from authorised distributors of Infineon, STMicroelectronics and ON Semiconductor with bonded warehouses in Mumbai and Chennai. Manufacturers of passive components (capacitors, resistors, inductors) are available in Bengaluru and Hyderabad. The fabrication of PCBs is available in the country from the fabs at Bengaluru and Noida at affordable quality.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_5_%E2%80%94_Licenses_and_Regulatory_Approvals\"><\/span><strong>Step 5 \u2014 Licenses and Regulatory Approvals<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Required clearances: GST registration (immediate), Udyam Registration (MSME), Factory License from the state labour department, Pollution Control NOC (consent to establish + consent to operate \u2013 apply early and it takes 45 \u2013 90 days), BIS certification for applicable components (ISI mark requirement is increasing for EV electronics), AIS 156 compliance for battery related components. The registration on the <a href=\"https:\/\/heavyindustries.gov.in\/\" target=\"_blank\" rel=\"noopener\">PLI Auto portal before the production<\/a> is carried out is mandatory for being eligible for PLI as registration after production is not accepted.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Step_6_%E2%80%94_Timeline_and_Team\"><\/span><strong>Step 6 \u2014 Timeline and Team<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Typical time for company registration to first production dispatch: 9-14 months. Register company and obtain factory license in Month 1 \u2013 2. Order machinery, prepare shed in Month 3-5. Install, commission and test line in Month 6-8. OEM qualification and sample approvals in Month 9-12. First bulk dispatch, Month 12-14. 2 electronics engineers, 2 production technicians, 1 quality manager, 1 accounts\/compliance person are needed on startup team. Total headcount: 6\u20138 people.<\/p>\n<h3 style=\"text-align: center;\"><span class=\"ez-toc-section\" id=\"Discover_business_ideas_that_actually_make_money\"><\/span><a href=\"https:\/\/www.niir.org\/startup-selector\" target=\"_blank\" rel=\"noopener\">Discover business ideas that actually make money<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<h2><span class=\"ez-toc-section\" id=\"Table_2_Investment_Breakdown_for_an_EV_Components_Manufacturing_Unit\"><\/span><strong>Table 2: Investment Breakdown for an EV Components Manufacturing Unit<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<table>\n<tbody>\n<tr>\n<td><strong>Cost Head<\/strong><\/td>\n<td><strong>Small Unit (INR)<\/strong><\/td>\n<td><strong>Mid-Scale Unit (INR)<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Land &amp; civil works (leased shed ~5,000 sq ft)<\/td>\n<td>12,00,000<\/td>\n<td>25,00,000<\/td>\n<\/tr>\n<tr>\n<td>Core machinery (CNC, winding, testing rigs)<\/td>\n<td>35,00,000<\/td>\n<td>75,00,000<\/td>\n<\/tr>\n<tr>\n<td>Electrical &amp; utility setup<\/td>\n<td>5,00,000<\/td>\n<td>10,00,000<\/td>\n<\/tr>\n<tr>\n<td>Raw material (initial 3-month stock)<\/td>\n<td>18,00,000<\/td>\n<td>40,00,000<\/td>\n<\/tr>\n<tr>\n<td>Working capital &amp; salaries (6 months)<\/td>\n<td>12,00,000<\/td>\n<td>28,00,000<\/td>\n<\/tr>\n<tr>\n<td>Certifications, licenses, consultancy<\/td>\n<td>3,00,000<\/td>\n<td>6,00,000<\/td>\n<\/tr>\n<tr>\n<td>Contingency (10%)<\/td>\n<td>8,50,000<\/td>\n<td>18,40,000<\/td>\n<\/tr>\n<tr>\n<td>TOTAL CAPEX (approx.)<\/td>\n<td>93,50,000<\/td>\n<td>2,02,40,000<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Source: <a href=\"https:\/\/www.nsic.co.in\/\" target=\"_blank\" rel=\"noopener\">NSIC Technology Centre Equipment Lists<\/a>; NPCS techno-economic estimates (niir.org); author field research, Hosur &amp; Chakan clusters<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Financial_Snapshot_What_the_Numbers_Actually_Look_Like\"><\/span><strong>Financial Snapshot: What the Numbers Actually Look Like<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>With product mix and OEM pricing, a small EV motor controller unit, with a total capex of \u20b990\u201395 lakh, can provide a monthly revenue of \u20b91.8\u20132.2 crore when it operates at 60%. With 100% capacity, the monthly revenue increases to \u20b93.2-3.8 crore. The numbers are based on an average of the standard BLDC motor controllers being sold at \u20b94,800 per unit at 60% capacity output of 650\u2013800 units\/month.<\/p>\n<p>At volume, the gross margins for this segment are in the 22-28% range. Once the monthly revenue of the unit moves beyond \u20b92 crore, net margins (after depreciation, salaries, rent, and overheads) is stabilized at 14-18%. Initial investment of \u20b990-95 lakhs has a payback period of 36-42 months with 60% utilisation. Payback reduces to 24-28 months at 80%+ and less.<\/p>\n<p>Aravind&#8217;s unit achieved profit of zero in the 29th month. The PLI incentive cheque in Year 3 helped him repay his loans at an earlier stage, and that, he believes, helped save the business during the raw material shortage time.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Table_3_Applicable_Government_Schemes_Eligibility_and_Benefits\"><\/span><strong>Table 3: Applicable Government Schemes, Eligibility, and Benefits<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<table>\n<tbody>\n<tr>\n<td><strong>Scheme<\/strong><\/td>\n<td><strong>Nodal Ministry\/Body<\/strong><\/td>\n<td><strong>Key Benefit<\/strong><\/td>\n<td><strong>Eligibility Threshold<\/strong><\/td>\n<\/tr>\n<tr>\n<td>PLI \u2013 Auto &amp; EV Components<\/td>\n<td>MHI \/ DPIIT<\/td>\n<td>4\u201318% incentive on incremental sales<\/td>\n<td>Min. investment \u20b950 Cr (OEM); \u20b95 Cr (Tier-2 component)<\/td>\n<\/tr>\n<tr>\n<td>FAME-II (OEM supply chain)<\/td>\n<td>DHI<\/td>\n<td>Demand incentive trickle to Tier-2 suppliers<\/td>\n<td>Registered with OEM under FAME-II<\/td>\n<\/tr>\n<tr>\n<td>CGTMSE (credit guarantee)<\/td>\n<td>MSME Ministry \/ SIDBI<\/td>\n<td>Collateral-free loan up to \u20b92 Cr<\/td>\n<td>Micro &amp; small enterprises, Udyam registered<\/td>\n<\/tr>\n<tr>\n<td>PMEGP<\/td>\n<td>MSME Ministry \/ KVIC<\/td>\n<td>25\u201335% capital subsidy on project cost<\/td>\n<td>New units; project cost up to \u20b950 L (mfg.)<\/td>\n<\/tr>\n<tr>\n<td>Startup India \/ DPIIT Recognition<\/td>\n<td>DIPP<\/td>\n<td>Tax holiday (3 of 10 yrs), fast IPR<\/td>\n<td>DPIIT-recognised startups &lt; 10 yrs old<\/td>\n<\/tr>\n<tr>\n<td>State EV Policy (Tamil Nadu \/ Gujarat)<\/td>\n<td>State Govt. (SIPCOT \/ iNDEXTb)<\/td>\n<td>Capital subsidy 15\u201325%, power tariff relief<\/td>\n<td>Minimum investment &amp; job creation criteria<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2><span class=\"ez-toc-section\" id=\"Getting_Your_Numbers_Right_Before_You_Start\"><\/span><strong>Getting Your Numbers Right Before You Start<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a href=\"https:\/\/www.niir.org\/\" target=\"_blank\" rel=\"noopener\">Niir Project Consultancy Services (NPCS)<\/a> is another resource that is often used by serious EV manufacturers and component manufacturers while planning a project as it provides in-depth project reports, Techno-economic feasibility studies, Plant layout designs, and end to end manufacturing consultancy for various industries such as EV components. Their reports include information on investment needs, regulatory process, PLI scheme documentation formats, machinery sourcing and more \u2013 cutting down the time a first-time founder would spend creating these frameworks from scratch. Their EV components DPR (detailed project report) has been referred to by applicants while going through the PLI qualification procedure. Reports and consultancy are available on <a href=\"https:\/\/www.niir.org\/\" target=\"_blank\" rel=\"noopener\">niir.org<\/a> and quoted by <a href=\"https:\/\/www.entrepreneurindia.co\/\">entrepreneurindia.co<\/a> as a starting point for MSME project planning.<\/p>\n<h3 class=\"wp-block-heading has-text-align-center\" style=\"text-align: center;\"><span class=\"ez-toc-section\" id=\"Related_Article_Top_Electrical_Insulation_Manufacturing_Business_Ideas_in_India_Low_Investment_High_Demand_MSME\"><\/span>Related Article: <a href=\"https:\/\/www.niir.org\/blog\/electrical-insulation-manufacturing\/\" target=\"_blank\" rel=\"noopener\">Top Electrical Insulation Manufacturing Business Ideas in India (Low Investment, High Demand MSME)<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<h2><span class=\"ez-toc-section\" id=\"ENTREPRENEUR_SPOTLIGHT\"><\/span><strong>ENTREPRENEUR SPOTLIGHT<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><strong>Aravind Krishnamurthy, Hosur, Tamil Nadu<\/strong> \u2013 Aravind has made a third startup venture, a BLDC motor controller unit, make a revenue of \u20b940 crore within five years of his first dispatch. Key Lesson: &#8220;In the first co-founder agreement, you need to have exit valuation clauses and IP ownership terms. I wasted 14 months and \u20b922 lakh on legal expenses in my second venture when we failed to have that discussion.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Your_Next_Move_%E2%80%94_Make_It_in_the_Next_30_Days\"><\/span><strong>Your Next Move \u2014 Make It in the Next 30 Days<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The EV component opportunity is indeed there and the numbers are there to back entry. However, there is a limit to the window. At this time, OEMs are already creating their preferred supplier list. Once those lists lock (usually when the manufacturer ships 3-4 quarters without defects) it is structurally more difficult to break in.<\/p>\n<p>Select one component sub-category for this week. Shortlist two OEMs in your target region with the <a href=\"https:\/\/www.entrepreneurindia.co\/blogs\/electrical-and-ev-manufacturing\/\">fastest growing EV<\/a> brands. Contact their vendor development teams directly \u2013 most vendors have made contact information for their development teams available in their FAME-II compliance disclosures. Do not invest in capex without having a Letter of Intent or a sample order. That LOI is the most important document you will have in your fundraising and PLI process.<\/p>\n<p>If not yet done, conduct a techno-economic feasibility study for your unit. Apply it to &#8220;test run&#8221; your numbers before your bank or investor. The badness of the market does not make the failure of the founders to be a failure. They fail due to their overly optimistic planning with real costs.<\/p>\n<p><strong>Act now. The base year for PLI calculations is the year you begin production. Every quarter you wait reduces the incentive pool available to you.<\/strong><\/p>\n<div class=\"jeg_video_container jeg_video_content\"><iframe title=\"E-Vehicle Manufacturing Industry | Most Lucrative Startup Opportunities in Electric Vehicle Industry\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/dJkv_tqJa1w?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/div>\n<h2><span class=\"ez-toc-section\" id=\"Frequently_Asked_Questions\"><\/span><strong>Frequently Asked Questions<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><strong>1. What is the investment required to start an EV component manufacturing facility?<\/strong><\/p>\n<p>The estimated total investment for a small-scale unit for BLDC motor controller or wiring harness is between 75-95 lakh for machinery, fit-out and the initial stock and working capital for 6 months. The total capital expenditure (CAPEX) for a mid-size unit with eligibility for PLI scheme incentive is around 1.8-2.2 crore. CGTMSE backing for collateral free loans is available up to 2 crore for eligible MSME applicants.<\/p>\n<p><strong>2. Which are the license and clearances necessary for commencing production?<\/strong><\/p>\n<p>These non-negotiable clearances are GST registration, Udyam (MSME) registration, Factory License, Consent to Establish and Consent to Operate from the State Pollution Control Board, BIS certificate for BIS mandated product list, and <a href=\"https:\/\/heavyindustries.gov.in\/\" target=\"_blank\" rel=\"noopener\">MHI PLI portal<\/a> registration before commencement of production, retroactively this cannot be done, for all battery adjacent components, AIS 156 compliance is required.<\/p>\n<p><strong>3. How can I procure raw materials like semiconductors and passive components?<\/strong><\/p>\n<p>Power semiconductors, IGBTs, MOSFETs, SiC components are mostly import based. Procure through official distributors: Arrow Electronics, Mouser, and Avnet; they have bonded ware houses in Mumbai and Chennai for reducing transit times, however, passive components can be procured from manufacturers in Bangalore and Hyderabad. PCB fabricators in Bangalore, Noida and Gandhinagar can produce good quality EV grade PCBs at feasible rates.<\/p>\n<p><strong>4. What profit margin is expected for EV component manufacturers?<\/strong><\/p>\n<p>Gross margin between 22-28 percent is available at &gt; 500 units\/month for motor controllers and, net margin between 14-18% will stabilise when revenue crosses 2 crore \/ month, absorbing all fixed over heads; below that revenue, profit margin is negative to thin; for years 3-5 PLI incentives between 4-18 percent for increased sales adds 3-6% additional to the net margin for eligible units.<\/p>\n<p><strong>5. How does PLI for automotive components affect an MSME-sized manufacturer?<\/strong><\/p>\n<p>The PLI for advanced automotive technology product aims at incentivizing additional sales over and above a defined base year; key conditions: do not artificially inflate the base year value, be an eligible component manufacturer in the stated product list, claims are annually validated, the Ministry of heavy industry will facilitate-register for the incentive scheme before commencing any production, T2 manufacturers are eligible for less investment than T1 manufacturers.<\/p>\n<p><strong>6. What kind of support can NPCS\/NIIR offer a first-time EV component manufacturer?<\/strong><\/p>\n<p>NIIR Project Consultancy Services (niir.org) provides techno economic feasibility, layout, machinery specifications, raw material and financial feasibility reports in the form of DPRs; they offer specialized DPRs for EV component manufacturing, including formats for PLI eligibility documentation and regulatory approval check list which cut down planning time from several months to a few weeks for first time manufacturers, this also serves as a supporting document for bank loans and government schemes. Log on to <a href=\"https:\/\/www.niir.org\/\" target=\"_blank\" rel=\"noopener\">niir.org<\/a> or <a href=\"https:\/\/www.entrepreneurindia.co\/\">entrepreneurindia.co<\/a> for more details.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Key_Data_Sources_Citations\"><\/span><strong>Key Data Sources &amp; Citations<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><a href=\"https:\/\/www.siam.in\/statistics.aspx?mpgid=8&amp;pgidtrail=14\" target=\"_blank\" rel=\"noopener\">SIAM \u2013 Society of Indian Automobile Manufacturers (EV Sales Data)<\/a><\/p>\n<p><a href=\"https:\/\/heavyindustries.gov.in\/\" target=\"_blank\" rel=\"noopener\">Ministry of Heavy Industries \u2013 PLI Auto Scheme Documentation<\/a><\/p>\n<p><a href=\"https:\/\/e-amrit.niti.gov.in\/\" target=\"_blank\" rel=\"noopener\">NITI Aayog \u2013 e-Amrit EV Market Intelligence Portal<\/a><\/p>\n<p><a href=\"https:\/\/www.cgtmse.in\/\" target=\"_blank\" rel=\"noopener\">CGTMSE \u2013 Credit Guarantee Fund Trust for Micro &amp; Small Enterprises<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>EV Component Manufacturing Business in India The Number That Changes Everything Ninety-four percent. This is India&#8217;s reliance on imports for sophisticated power electronics that power EVs such as motor controllers, on-board chargers, and battery management systems. The brain of an electric 2-wheeler that rolls out of any Pune factory, is almost surely Chinese or Taiwanese. [&hellip;]<\/p>\n","protected":false},"author":16,"featured_media":8644,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"format":"standard","override":[{"template":"2","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"default-sidebar","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"topbottom","share_float_style":"share-monocrhome","show_share_counter":"1","show_view_counter":"1","show_featured":"1","show_post_meta":"1","show_post_author":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"1","show_post_reading_time":"0","post_reading_time_wpm":"300","post_calculate_word_method":"str_word_count","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"1","show_prev_next_post":"1","show_popup_post":"1","show_comment_section":"1","number_popup_post":"1","show_author_box":"1","show_post_related":"0","show_inline_post_related":"0"}],"image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post_position":"meta","trending_post_label":"Trending","sponsored_post_label":"Sponsored by","disable_ad":"0","subtitle":"Real-world lessons in failure recovery, PLI scheme navigation, and co-founder dynamics from the EV sector's hidden pioneer."},"jnews_primary_category":[],"jnews_social_meta":[],"jnews_paywall_metabox":{"paragraph_limit":"2","enable_premium_post":"0","enable_free_post":"0","override_paragraph_limit":"0","enable_preview_post":"0","enable_preview_video":"0"},"jnews_override_counter":{"view_counter_number":"0","share_counter_number":"0","like_counter_number":"0","dislike_counter_number":"0"},"footnotes":""},"categories":[1081,1227,1139],"tags":[2232,2229,2231,2230,2233],"class_list":["post-8643","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-manufacturing-business-ideas","category-government-schemes-policies","category-renewable-energy","tag-electric-vehicle-components-manufacturing","tag-ev-component-manufacturing-business-in-india","tag-ev-component-manufacturing-startup","tag-ev-components-manufacturing-india","tag-ev-parts-manufacturing-business"],"_links":{"self":[{"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/posts\/8643","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/comments?post=8643"}],"version-history":[{"count":1,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/posts\/8643\/revisions"}],"predecessor-version":[{"id":8646,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/posts\/8643\/revisions\/8646"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/media\/8644"}],"wp:attachment":[{"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/media?parent=8643"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/categories?post=8643"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.entrepreneurindia.co\/blogs\/wp-json\/wp\/v2\/tags?post=8643"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}