EV components · Automotive and auto components
Supply the EV transition without carrying its design and credit risk
EV component makers sell into a market where designs, customers and policy all move quickly. We cost each design revision, track the localisation your customers need evidence of, and measure the credit risk of every customer. Growth then does not become a pile of obsolete stock and doubtful debts.
In one paragraph
Makers of traction motors, motor controllers, chargers, DC-DC converters, battery management systems, harnesses and EV-specific mechanical parts often sell to young, funding-dependent customers. Most turn over ₹10–500 crore. They supply electric two-wheeler, three-wheeler, bus and passenger-vehicle makers. Designs revise often, and key inputs are imported. The founder, chief executive or chief financial officer usually leads the work.
Founder, chief executive or chief financial officer
The economics
How the money moves in this trade
EV components combine imported electronics, magnets and cells with locally made housings, harnesses and assemblies. Imported content moves with exchange rates and global supply, while customers expect costs to fall programme by programme. Designs are revised frequently as vehicle makers refine their products. Each revision leaves superseded stock and engineering effort for someone to pay for.
Government incentives for electric vehicles and for automotive manufacturing tie eligibility to localisation and domestic value addition. Customers therefore ask suppliers for evidence of where content comes from. Customer payments may depend on the customer's own funding or incentive receipts. That makes credit risk more concentrated than in conventional automotive supply.
The problem
Where the numbers usually break down
Design revisions strand inventory
Engineering changes are accepted without costing the stock, work in progress and open purchase orders they make obsolete.
Engineering effort is not billed
Non-recurring engineering for customer-specific variants is absorbed into the piece price or given away entirely.
Localisation evidence is assembled late
Bill-of-material origin and value data are compiled when a customer asks, rather than maintained as purchases are made.
Customer credit is assessed on enthusiasm
Orders are accepted from fast-growing customers without limits tied to their funding position or payment history.
Warranty has no history behind it
New products carry multi-year warranties with no failure data, and no provision is built or revisited as data emerges.
What we do
The work, and the result each part produces
Engineering-change costing
Each design revision costed for stock, work in progress, open orders and engineering hours, before it is accepted.
Change costs are recovered or priced in.
Non-recurring engineering billing
Customer-specific development effort tracked and billed as a separate charge or recovered through an agreed piece-price element.
Development work is paid for.
Bill-of-material origin and value records
Each component's source, value and import content maintained as purchases are made, in the form customers and incentive schemes ask for.
Localisation evidence is ready when requested.
Landed-cost and exchange tracking
Imported components costed with duty, freight and realised exchange rate, compared with the quoted cost.
Quoted margins survive currency moves.
Customer credit limits and monitoring
Limits set per customer from their payment record and funding position, with exposure reported weekly.
Concentrated credit risk is managed, not discovered.
Warranty provisioning from emerging data
Field failures recorded by product and batch, and the provision revisited as the data grows.
Warranty cost is recognised as it emerges.
Where we start
The first steps of an engagement
Bills of material and customer ledgers
We ask for current bills of material with supplier and origin details, import documents, the engineering-change log, open purchase orders, customer ledgers and any localisation data already sent to customers.
Cost the last design revisions
Recent engineering changes are costed for the stock, work in progress, open orders and engineering hours they affected.
Credit limits and origin records
Credit limits are set per customer from payment record and funding position, and each component's origin and value start being recorded as it is bought.
A change, credit and content report
The first report shows the cost of engineering changes by customer, exposure against limit, and domestic content by part as documented.
How it is measured
The reports the work is judged on
Each is recorded as a baseline before the work starts, so later reports have an honest comparison.
- Cost of engineering changes, by customer
- Non-recurring engineering billed against spent
- Domestic content by part, documented
- Landed cost against quoted cost
- Exposure against limit, by customer
- Warranty claims against provision
Who it suits
Written for, and not the right fit for
- You need an eligibility opinion or claim filing under a government incentive scheme — the claim is your own, and certification is signed by an independently engaged professional.
- You make battery cells or packs — our battery manufacturers page is the closer fit.
- Makers of motors, controllers, chargers, BMS, harnesses and EV-specific parts.
- Suppliers to electric two-wheeler, three-wheeler, bus or passenger-vehicle makers.
- Funded component companies preparing for diligence or a new customer programme.
Services
Services this work draws on
Costing and profitability
What each product, line and customer really contributes.
Explore service ↗Fractional CFO services
Senior financial leadership on the days you need it, not a full-time hire.
Explore service ↗MIS and financial planning
Reporting built around the questions you actually need answered.
Explore service ↗Internal controls and risk
Controls sized to your business, documented and actually tested.
Explore service ↗Every other service, also available in this trade
Common questions
Questions owners in this trade ask
What localisation data do EV customers need from suppliers?
Usually the origin and value of each component in the bill of materials, held consistently and supportable by purchase records. The exact format depends on the scheme your customer is claiming under; we keep the underlying data so it can be produced in that format.
How do we set a warranty provision with no history?
Start from a reasoned basis — test data, comparable products, supplier warranties — and revisit it every quarter as field data arrives. The policy is agreed with your statutory auditor.
Should we keep supplying EV customers who pay late?
That's a commercial call, but it should be made with the exposure in front of you. We set limits and show the exposure against them, so the decision is explicit rather than drifting.
5th Quadrant maintains cost, origin and value records and prepares claim data. Eligibility under any government incentive scheme, the claim filing and any testing or homologation approval are the client's own responsibility with the relevant authority; certificates required by those schemes, statutory audit and tax-audit reports are signed by an independently engaged licensed professional. Full detail is on our Professional Scope page.
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