India's auto firms to give double-digit salary hikes in FY26: Deloitte

The automotive industry is set to provide an average salary increase of 10.1% in FY26, according to Deloitte’s ‘Performance and Rewards Trends Study’ referenced by The Economic Times. This forecast greatly exceeds the overall average salary growth of 8% seen across Indian sectors. Some companies concluded their appraisal processes by March 2025, while others plan to finish after June, depending on their fiscal year end. As noted by Deloitte India's Partner, Mr. Neelesh Gupta, FY26 will represent the fifth consecutive year of double-digit salary increases for the automotive industry, although the growth rate has been gradually slowing down over the last three years. The current forecast is slightly less than the 10.5% noted in FY25, but still outpaces the projected 8.8% average for Indian corporations. This sustained growth is fueled by the increasing demand for specialized skills in electric vehicles (EVs), automation, artificial intelligence (AI), product development, and machine learning. Human Resource leaders at Hyundai Motor India Ltd and Skoda Auto Volkswagen India Pvt Ltd have linked these increased salary hikes to the growing need for skilled positions. Top achievers are likely to receive raises significantly above the 10% threshold. Meanwhile, India’s automobile exports rose by 19% in FY25, exceeding 5.3 million units, up from 4.5 million in FY24, as reported by the Society of Indian Automobile Manufacturers (SIAM). Exports of passenger vehicles specifically increased by 15% to 770,364 units. In contrast, the IT services sector is anticipated to experience more restrained salary growth of 4% to 8.5% due to global economic challenges and evolving skills requirements, indicating a transition towards more sustainable compensation approaches amidst the growing integration of AI.