India’s automotive industry is set to offer an average salary hike of 10.1% in FY26, marking the fifth consecutive year of double-digit increments.
Deloitte’s Performance and Rewards Trends Study reports that the automotive industry will see a 10.1% salary increase in FY26.
This growth surpasses the 8% average salary hike observed across other Indian sectors.
The high demand for skilled professionals in electric vehicles (EVs), automation, AI, and machine learning (ML) is fueling salary hikes.
Companies are actively investing in specialized talent to support advancements in these emerging technologies.
Leading auto firms Hyundai Motor India Ltd (HMIL) and Skoda Auto Volkswagen India Pvt Ltd have confirmed salary increments for their top-performing employees.
These employees will receive raises exceeding 10%, reflecting their contributions and high performance.
Key Drivers Behind the Salary Hikes
The double-digit pay hikes in the auto sector are fueled by several factors:
- Rising demand for EV expertise: Companies are investing heavily in EV technology, requiring specialized talent in battery management, charging infrastructure, and autonomous driving systems.
- Automation and AI adoption: The industry is integrating AI-driven solutions for manufacturing, supply chain optimization, and predictive maintenance, increasing demand for AI and ML specialists.
- Product engineering and R&D expansion: Firms are focusing on next-generation vehicle designs, leading to higher salaries for engineers and researchers.
- Global market growth: India’s automobile exports surged 19% in FY25, reaching 5.3 million units, further boosting demand for skilled professionals.
Salary Trends Across the Auto Industry
Companies project a 10.1% average salary hike, with specialized roles receiving even higher increments:
- EV and AI specialists: Up to 20–25% salary hikes for high-impact hires.
- Product engineers and R&D professionals: 15–18% increments for critical roles.
- Top performers: Raises twice the industry average, depending on strategic impact.
Comparison with Other Sectors
The automotive industry continues to outpace India Inc’s overall salary growth, which averages 8.8% for FY25.
The IT sector will see modest salary hikes ranging from 4–8.5% in the upcoming fiscal year.
This reflects ongoing global economic uncertainties and companies’ focus on cost optimization efforts.
Industry Leaders on Compensation Strategies
HR executives from Hyundai, Skoda Auto Volkswagen, and Sonalika Group have highlighted the importance of performance-driven compensation models in the auto industry.
They ensure that high-performing employees receive differentiated increments based on their contributions and expertise.
Natwar Kadel, Associate VP at HMIL, stated, “Our hike budget was maintained with sharper differentiation for high-performing individuals, potential talent, and niche skill holders.”
Amit Sharma, Corporate HR Head at Sonalika Group, added, “Key performers and high-impact hires are likely to earn far higher increments, as high as 20–25%.”
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