India's government pushed back hard yesterday against Washington's proposed 12.5% tariff under a Section 301 forced-labour investigation — but the damage for auto component exporters may already be baking in. The US absorbs roughly billion of Indian auto parts annually, and the probe targets the very sector that has been India's manufacturing success story. We dug through recent corporate filings to find the companies with the most US skin in the game.
The Threat in Context
The US Trade Representative's Section 301 investigation is probing labour practices across Indian export industries, with auto components and textiles in the spotlight. If the proposed 12.5% tariff sticks, it would land on top of existing duties — currently 25% on light vehicle parts and 50% on truck and off-highway components, as CIE Automotive India detailed in their October 2025 investor presentation. The cumulative tariff burden on some auto parts could approach 60%.
India's auto component industry body ACMA has pushed back, reporting the sector clocked 12.7% growth in FY26 and calling the US allegations on labour practices unfounded. But filings tell a more nuanced story about who's actually exposed.
The Most Exposed
Bharat Forge is the clearest casualty so far. Per their FY26 investor presentation, standalone revenue fell 5% year-over-year to INR 8,396 crores, driven largely by a North American collapse — commercial vehicle exports to the region plunged 67% year-over-year. The company absorbed INR 31 crores in direct tariff costs in Q4 FY26 alone, plus another INR 12 crores the previous quarter. Management flagged "regulatory uncertainties in North America" as the primary drag, though EBITDA margins held at 27.3% thanks to a strong domestic auto and defence book. MM Forgings carries arguably the most concentrated US risk among mid-caps. Per their FY26 board outcome filing, the US accounts for 21.6% of revenue — more than Europe (10.6%) and South America (4.2%) combined. When asked during earnings calls for a more granular US breakdown, management declined to share further details, which isn't exactly reassuring for investors trying to model the tariff impact. Ramkrishna Forgings has been quietly reshaping its geographic mix in response. Per their FY26 earnings transcript, North America's share of exports dropped from 71% to 55% over nine months, while domestic revenue climbed to 67-68% of the total (up from 59% in FY25). The company confirmed it faced a flat 25% tariff on light vehicle exports to the US. Despite the pivot, FY26 standalone revenue still grew 3.3% to INR 3,755 crores, and EBITDA margins actually improved to 15.1% from 13.5% — suggesting the domestic bet is paying off. Balkrishna Industries is the most export-heavy name on this list. Per their FY26 annual report, exports account for over 65% of consolidated revenue of INR 10,823 crores. Management acknowledged in their FY26 earnings transcript that tariffs have "impacted everybody, even local manufacturers whose raw materials come from Asia," and said they're sharing the tariff burden with channel partners. The company's Q4 FY26 standalone EBITDA margin of 22.9% held up, partly because their off-highway tyre niche (agriculture, mining, construction) faces less direct price competition than commodity auto parts. Steel Strips Wheels shows the most volatile tariff sensitivity. Per their FY26 investor presentation, the US is their largest export market, but export revenue swung from INR 160 crores (up 30% when sentiment was positive) to just INR 111 crores (down 26% year-over-year) in a single quarter when tariff fears spiked. The company has responded by pivoting hard toward Europe, which now accounts for 52% of exports. They're guiding INR 550-600 crores in full-year export revenue for FY26.Who's Better Insulated
Not every auto component maker is equally exposed. Samvardhana Motherson disclosed in their Q1 FY26 earnings transcript that US export content from India is less than million per quarter, with the vast majority of their US sales being USMCA-compliant (manufactured in North America). They described the tariff impact as not material. CIE Automotive India's management similarly called the impact "not very significant," noting that compared to China and Vietnam, India's 25% tariff on light vehicle parts doesn't impose a major relative disadvantage.
What Retail Investors Should Watch
The Section 301 process has a public comment period and hearing phase before any tariff takes effect — this isn't happening overnight. But auto component companies with more than 20% US revenue exposure (MM Forgings, Bharat Forge) deserve closer scrutiny on your next portfolio review. Watch for two signals: first, whether the India-US bilateral trade talks produce a carve-out for auto parts, and second, how quickly companies can pass tariff costs to customers or redirect sales. Ramkrishna Forgings' pivot to domestic revenue is a template that others may follow. For new positions, names with local-for-local manufacturing in the US (Motherson) or niche products with less price elasticity (Balkrishna Industries' off-highway tyres) offer better insulation from the tariff overhang.
Data sourced from company filings on NSE via Xaro.