( l to r) S. Chandrasekar, Corporate Director- Roots Group of Companies, Founder Trustee and Vice President- Society for Smart E-mobility; Shreshth Mishra, Co-founder and Chief People Officer, Simple Energy; Sudeepth Puthumana, Head of Mobility, L&T Electronic Products and Systems and Ramesh M, Moderator and Consulting Editor, The Hindu businessline | Photo Credit: BIJOY GHOSH

The automotive industry has long been a big contributor to the MSME ecosystem, but the blistering pace of EV adoption is set to bring about a paradigm shift. For MSMEs to remain on the right side of this transformation, it is critical that they rejig their model from being mere subcontractors to owning high-value manufacturing and assembly, according to industry stakeholders speaking at the MSME growth conclave in Coimbatore.

S Chandrasekar, Corporate Director, Roots Group of Companies, Founder Trustee and Vice-President, Society for Smart E-mobility, said that EVs offer both an opportunity and threat for traditional MSMEs. “ICE vehicles have more than 2,200 components supplied by MSMEs. For EVs, it is only about 100. As the industry moves towards EVs, it is important that MSMEs focus on technically high-precision components, which electric mobility increasingly requires like sensors and software-defined vehicles,” he added. 

R&D investment

Chandrasekar also emphasised the need for MSMEs to increase their R&D investment and the development of proprietary technologies in niche products and specialised components. Shreshth Mishra, Co-founder and Chief People Officer, Simple Energy, said that the company works with over 200 vendors and explicitly prefers developing smaller suppliers, rather than relying solely on established Tier-1 companies.

“We believe as the EV industry becomes mainstream, there is a huge opportunity not just for manufacturing, but other sectors like battery validation, second-life applications and recycling, MSMEs to participate at multiple points in the value chain,” he said. 

Sudeepth Puthumana, Head of Mobility, L&T Electronic Products and Systems, noted that building domestic ecosystems for EVs is especially critical since Indian automakers still rely heavily on global supply chains for components. “Many Indian start-ups have shown that local supply chains can be built around Indian requirements. MSMEs similarly need to to participate in technologies that are traditionally sourced from global players,” he said.

He added that the relatively lower penetration of EVs right now means there still remains time for MSMEs to reposition themselves. “If companies start transforming today, there is a huge opportunity ahead. The industry is moving towards electronics, AI-driven systems and connected vehicles, creating entirely new areas where MSMEs can build specialised capabilities,” he said.

Published on June 27, 2026