According to a Reuters report, the chief executives of Volkswagen, BMW and Mercedes-Benz have welcomed the finalisation of the long-pending free trade agreement between India and the European Union, describing the deal as a significant opening for Germany’s export-driven economy and for Europe’s broader industrial ambitions.
Speaking on Tuesday, the leaders of Germany’s three largest carmakers said the agreement could strengthen trade flows, expand market access and unlock new opportunities in India’s fast-growing automotive sector, now the world’s third largest by volume.
Their comments come as European and Indian negotiators concluded talks on the landmark trade pact after years of negotiations, in what policymakers on both sides have described as a turning point in bilateral economic relations.
BMW: Trade Pact Vital for Germany’s Export Model
BMW Chief Executive Oliver Zipse underlined the importance of the agreement for Germany’s economic future, particularly as global trade faces increasing geopolitical pressures and protectionist tendencies.
“The deal is extremely important for Germany as an export nation, which we want to remain – we are very pleased that things are now moving quickly, that we are expanding multilateral relations rather than cutting them off,” Zipse told Reuters.
He was speaking on the sidelines of a business conference organised by German newspaper Welt in Berlin.
Germany’s automotive industry, long a pillar of the country’s manufacturing and export strength, has been seeking new growth markets as demand in parts of Europe and China shows signs of moderation.
Mercedes-Benz: Market Opening Benefits Europe as Well
Mercedes-Benz CEO Ola Kaellenius echoed similar optimism, framing the agreement as beneficial not only for German companies but for the European economy as a whole.
“Any move towards opening up markets and strengthening trade, as well as our opportunities to expand our strong export economy, is positive for Germany and positive for Europe,” Kaellenius told Reuters.
European carmakers have been lobbying for improved access to India’s tightly regulated auto market, which currently imposes some of the world’s highest import duties on fully built vehicles.
Volkswagen Sees Strategic Opportunity in India
Volkswagen CEO Oliver Blume said his company strongly supported global trade initiatives and would closely study how the new agreement could reshape its India strategy.
Blume said he backed: “every initiative for trade agreements with regions of the world.”
He added that Volkswagen sees long-term potential in India’s automotive sector, which has rapidly expanded over the past decade.
Volkswagen would now: “carefully examine the details of the trade agreement and then evaluate how we will proceed in India,” he said.
India has emerged as the world’s third-largest car market after China and the United States, driven by rising incomes, urbanisation and government-led manufacturing initiatives.
Trade Ties Already Significant
Trade figures highlight the existing scale of cooperation between Germany’s auto industry and India.
In 2024, German automotive exports to India were valued at €1.115 billion ($1.32 billion), according to data from the German automotive industry association VDA.
Of this, €868 million consisted of auto parts, underlining India’s growing role not only as a consumer market but also as part of global automotive supply chains.
Broader Implications
Industry analysts say the EU–India trade agreement could reduce tariffs, ease regulatory barriers and encourage greater investment in local manufacturing and electric mobility, areas where German carmakers already have technological advantages.
For Germany, which remains heavily dependent on exports, the deal offers a potential counterbalance to slowing growth in traditional markets and rising trade friction elsewhere.
For India, deeper access to European technology and capital could support its ambition to become a global manufacturing hub for automobiles and clean mobility solutions.
As negotiations now move into the implementation phase, automakers and investors across Europe will be watching closely to see how quickly the agreement translates into tangible commercial gains.
