Production Linked Incentive Scheme For Automobile And Auto Component Industry

What is the PLI Scheme for Automobile and Auto Component Industry?

The Production Linked Incentive (PLI) Scheme for Automobile and Auto Component Industry is an industrial-incentive scheme of the Ministry of Heavy Industries. It is designed to overcome cost disabilities faced by domestic manufacturers of Advanced Automotive Technology (AAT) products and to build local and global supply chains for higher-technology vehicles and components.

According to the Ministry of Heavy Industries, the scheme has a total budgetary outlay of Rs 25,938 crore over a five-year period. It pays incentives on the incremental sales of eligible AAT products over a base year, that is, the more an approved company grows its sales of qualifying advanced products, the more incentive it earns, within the limits set by the scheme.

Key features

• Industrial incentive administered by the Ministry of Heavy Industries.
• Total outlay of Rs 25,938 crore over five years.
• Incentive paid on incremental sales of Advanced Automotive Technology products.
• Two applicant categories: Champion OEM (complete vehicles) and Component Champion (components).
• Aimed at deepening localisation and promoting electric and other advanced-tech vehicles.

This is an incentive for companies. It is not a subsidy that individuals, dealers or vehicle buyers can apply for. The consumer-facing electric-vehicle demand subsidies sit under separate schemes such as FAME/PM E-DRIVE, not this one.

Who is eligible for the PLI Auto scheme?

A company could apply in one of two categories:

• Champion OEM incentive, for companies manufacturing complete Advanced Automotive Technology vehicles.
• Component Champion incentive — for companies manufacturing AAT components and sub-systems.

The scheme guidelines set revenue and investment thresholds for each category, with separate eligibility conditions for existing automotive companies and for new non-automotive investors entering the sector. Selected applicants had to commit new investment and meet the defined sales and localisation conditions to earn the incentive.

Who cannot apply:

• Individuals cannot apply. This is an industrial incentive, not a personal or household benefit, vehicle buyers, drivers and dealers are not applicants.
• Companies that do not meet the revenue and investment thresholds for a Champion OEM or Component Champion are not eligible.
• Companies whose products are not on the approved Advanced Automotive Technology list cannot earn the incentive, because only sales of qualifying AAT products count.

Because the application window for selecting Champion OEMs and Component Champions has closed and approved applicants have been notified, a new company generally cannot join the scheme now.

How much incentive does the scheme provide?

The incentive is calculated on the determined (incremental) sales value of eligible AAT products, using incentive slabs set in the scheme guidelines, within the overall outlay of Rs 25,938 crore. The incentive rises with the level of determined sales, and the scheme's structure ensures that only one incentive applies to a given product, at either the vehicle or the component level, not both.

The exact incentive percentages differ between the Champion OEM and Component Champion categories and across sales slabs, and are defined in the Ministry's scheme guidelines. Companies should read the current guidelines on the PLI-Auto portal for the precise slab applicable to their products rather than rely on a single headline rate.

What documents are required?

How to apply for the PLI Auto scheme

1. Confirm the applicant is a company that qualifies as a Champion OEM or Component Champion under the revenue and investment thresholds in the scheme guidelines.
2. Prepare the application dossier: company and financial documents, the committed investment and production plan, and details of the Advanced Automotive Technology products.
3. Apply to the Ministry of Heavy Industries through the PLI-Auto process (pliauto.in) during the notified application window, and undergo the Ministry's examination and approval.
4. Once approved and after making the committed investment, claim the incentive on eligible incremental AAT sales as per the disbursement mechanism, submitting the required sales and testing verification.

As the selection window has closed, prospective manufacturers should watch the Ministry of Heavy Industries and PLI-Auto portal for any fresh windows or successor schemes rather than assume the current window is open.

Help and where to check details

The scheme is administered by the Ministry of Heavy Industries. The official portal is pliauto.in, with programme information also on heavyindustries.gov.in, and the Ministry can be reached on 011-23061490. Because incentive slabs, thresholds and windows are defined in the Ministry's scheme guidelines and updated over time, companies should rely on the current guidelines on the official portal. This guide intentionally does not fix a single incentive percentage where the official slab structure could not be confirmed against a current source.