Tamil Nadu's foundry sector, long considered a cornerstone of India's manufacturing strength, is undergoing a significant transformation. This industry, which creates metal castings by pouring molten metal into moulds, is at a critical juncture. After years of robust growth fueled by the automotive and engineering sectors, it now confronts the dual forces of global electrification and the push for sustainable manufacturing, even as shifting global supply chains present fresh opportunities.
Steady Growth and Distinct Clusters
Industry data indicates that Tamil Nadu's foundry sector has expanded at an impressive annual rate of 8–10% in recent years. This growth trajectory closely follows the state's booming automotive manufacturing ecosystem. Foundries serve as crucial upstream suppliers to major vehicle manufacturers (OEMs) and their primary component partners. The surge in vehicle production has consistently driven demand for both ferrous and aluminium castings.
T Supratheesh, a senior program associate at the independent research organization WRI India, notes that the sector has evolved into clear clusters. Large, capital-intensive foundries are increasingly located along the state's key automotive corridors, specifically the Kancheepuram–Tiruvallur–Chennai–Chengalpet belt and the Hosur–Krishnagiri–Dharmapuri region. These units dedicate 60–90% of their output to the auto industry, where precision, high volume, and international certifications are paramount.
In contrast, Coimbatore remains the heartland for small and medium ferrous foundries that cater to a diverse engineering base, including pumps, motors, and textile machinery. Meanwhile, aluminium die-casting MSMEs are clustered around Chennai's industrial estates like Ambattur, Perungudi, and Thirumudivakkam, supported by demand from automotive and electronics makers.
The Electric Vehicle Pivot and Sustainability Drive
The global shift towards electric vehicles is reshaping demand within the foundry sector. The transition is already reducing the need for certain traditional ferrous castings used in internal combustion engines (ICE). Conversely, it is accelerating demand for aluminium and lightweight alloy castings essential for EVs, such as motor housings, inverter casings, and battery structural parts.
Major industry players like Brakes India, Sundaram Clayton, and Craftsman Automation have been quick to adapt, investing in high- and low-pressure aluminium die-casting capacities and securing growing EV-related orders. However, MSME foundries are proceeding more cautiously, hindered by high capital costs, limited access to long-term finance, and uncertainty over the speed of EV adoption.
K Veluswami, Chairman of the Coimbatore chapter of the Institute of Indian Foundrymen (IIF), provides a broader perspective. He states that despite a reduction in the number of foundry units, overall output has risen, and the market value has swelled by more than 30% over the last decade. National foundry production is now estimated at 2 million tonnes annually, a leap from 0.6–0.7 million tonnes a decade ago. Coimbatore contributes 15–20% of this national output, with nearly 30% of all production being exported.
Sustainability is another powerful force for change. Numerous foundries in Tamil Nadu, often viewed as polluting, are now embracing greener practices. This involves eliminating toxic chemicals, minimizing resource use, and promoting recycling and eco-friendly packaging. Brakes India and Madras Engineering Industries are pioneers, supplying fossil-free 'green' iron castings to global giant Volvo.
V. Balajikrishnan, President and Head of Foundry Business at Brakes India, highlights that foundry operations are naturally suited to circular-economy models. He credits Tamil Nadu's access to renewable solar and wind energy, backed by supportive regulations, for helping foundries cut their carbon footprint significantly. In Coimbatore, many exporting foundries have shifted about 75% of their energy consumption to renewables, though achieving net-zero emissions remains a costly challenge, with the industry aiming for a 2030 target.
Challenges of Scale and the Road Ahead
Despite the opportunities, scaling up remains a structural hurdle. Srinivasan Ravi, CMD of Craftsman Automation, observes that while global foundry capacity is moving from Europe and East Asia to India, the country's installed capacity, especially in aluminium, is still far behind global needs. China supplies roughly 50% of the world's aluminium castings, while India accounts for only about 5%. In automotive aluminium alone, India possesses just about a tenth of China's capacity. Ravi attributes this gap to decades of constrained capital expenditure and tight lending in India, unlike China's state-backed financial support.
Consolidation is evident among smaller units. A Shiva Shanmughakumar, President of the Coimbatore Tiny and Small Foundry Owners' Association (COSMAFAN), reports that fierce competition and thin margins have forced many micro-foundries to close. Of approximately 400 foundries in Coimbatore, only around 250 are currently active. Rising urban land values also deter the next generation from continuing small-scale operations.
Industry stakeholders unanimously call for a dedicated technology-transition scheme. They argue that with structured financial support, shared infrastructure, technical assistance, and workforce skilling, MSME foundries can effectively upgrade and integrate into burgeoning global supply chains, particularly for electric vehicles. The future of Tamil Nadu's foundry hub depends on navigating this complex landscape of electrification, sustainability, and global competition.
