India's Auto Industry Cuts Production Amid Tech Talent Shortage, EV Transition Hits Workforce Bottleneck

Mahindra & Mahindra has recently cut SUV production by up to 15% due to labor shortages among its suppliers. Tata Motors and Bajaj Auto, while simultaneously expanding both electric vehicle (EV) and internal combustion engine (ICE) product lines, are also grappling with severe talent shortages. According to the Automotive Skills Development Council (ASDC), the core issue facing the industry is not an overall lack of manpower, but rather a shortage of “job-ready” technical talent equipped with expertise in EVs and advanced electronics. In major automotive manufacturing clusters such as Chakan near Pune and Chennai, key component suppliers commonly face a dilemma of “having orders but no engineers.” Engineers skilled in electronics, battery systems, and automation are being aggressively poached by technology firms, multinational R&D centers, and global engineering service providers offering significantly higher salaries. Traditional auto suppliers struggle to compete in terms of compensation, employer branding, and career development opportunities. Compounding the problem, these industrial clusters often suffer from inadequate infrastructure, long commutes, and housing shortages, further diminishing their appeal to skilled professionals. A deeper underlying issue is skills mismatch. The shift toward EVs and hybrid vehicles has substantially raised technical requirements for components like wiring harnesses and advanced electronic parts. However, India’s Industrial Training Institute (ITI) system continues to produce graduates primarily trained in ICE manufacturing, leaving them ill-equipped for the demands of electrified production. To mitigate the direct impact of supplier-level talent gaps on production, original equipment manufacturers (OEMs) are moving beyond their traditional role as auditors toward more proactive collaboration. Some automakers have already deployed manufacturing and quality experts to work directly at supplier facilities to stabilize operations or established dedicated logistics channels to ensure timely delivery of critical components. Industry insiders note that OEMs now recognize that talent shortages at suppliers can directly disrupt their own assembly lines. At the industry level, the ASDC is pushing to expand training programs and strengthen apprenticeship schemes, with a focus on EV assembly, robotics, and advanced electronics. Meanwhile, India plans to boost local manufacturing of key EV components and accelerate adoption of automation, IoT, and predictive maintenance technologies—initiatives that all hinge on the availability of a suitably skilled workforce. However, talent development takes time, while the pace of industry transformation continues to accelerate. Workforce supply is struggling to keep up with rapidly evolving demand. Whether India’s automotive sector can overcome this talent bottleneck will directly determine its competitiveness in the global race toward electric mobility.