HT Auto Leaderboard Awards 2026: India needs to make cars for the world, not just India: Mercedes-Benz India CEO

India needs to focus on building cars for global markets rather than developing products primarily for domestic demand if it wants to emerge as a major automotive manufacturing and export hub, said Santosh Iyer, MD & CEO, Mercedes-Benz India. He was speaking at the HT Auto Leaderboard Awards 2026, powered by HPCL with Knowledge Partner Vector Consulting, during the panel discussion on “Make for the World: Is India Ready to Become the World’s Auto Powerhouse?"

Iyer said India has developed a large automotive market and a strong manufacturing base, but products designed mainly for Indian regulations can face additional costs when they are exported to markets such as Europe and the US.

“In India’s case, our view has been that one of the biggest… India is the third-largest automotive industry, but the scale is also an entry barrier for many to come to India because the cars in India are predominantly for India," Iyer said.

According to him, differences in regulations can force manufacturers to re-engineer vehicles for individual markets, adding to costs and reducing India's competitiveness. He said greater regulatory harmonisation would allow manufacturers to develop vehicles with a global architecture and then adapt them to local requirements.

“So I think, first and foremost, we need to slowly start moving towards a harmonised regulatory setup so that we can make cars not only for India, but for the world," he said.

Iyer also highlighted the need for deeper localisation, particularly as vehicles become more dependent on electronics, batteries and other electrified components. He said India cannot depend solely on lower labour costs to remain competitive as automotive technology evolves.

“We can’t just rely on labour cost arbitrage. Those days are gone," Iyer said.

He added that India needs to look beyond manufacturing and consider what consumers in international markets will want in the future.

“The fundamental thing to ask is: the consumer of the world, where people have money in their pocket, what cars do they want in the future? Do we have the capability to produce, to design and produce those cars?" he said.

Iyer said developing products for global consumers, supported by localised manufacturing and harmonised regulations, would help India achieve the scale needed to expand exports.

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