With the liquidity position of the auto components industry comfortable across Tier 1 suppliers particularly, the auto components industry in India is set to witness a revenue growth of five to seven percent in FY2024-25 as compared to the high of 14 percent in FY2023-24.  

The stable cashflows and earnings supporting the comfortable liquidity position of Tier 1 suppliers in particular, the auto components industry in the country, according a ICRA Limited’s report will experience an improvement in operating margins – on a year-on-year basis – of roughly 50 bps in FY2024-25. This would be supported by better operating leverage, higher content per vehicle and value additions. 

The exposure to any sharp volatility in commodity prices and foreign exchange rates a continuing factor, the ICRA report projects that the industry will incur an expenditure of INR 200-250 billion in FY2024-25 towards capacity expansion and technological developments. Capex is anticipated to hover around eight to 10 percent of the operating income over the medium term. Contribution is also expected from the PLI scheme, which has been designed to exert a localisation push for electric vehicle components and technology. 

Providing an over view of ICRA’s take on the performance of the Indian auto industry, Vinutaa S, Vice President and Sector Head – Corporate Ratings, ICRA Limited, mentioned, "Demand from domestic original equipment manufacturers (OEM) constitutes over 50 percent of sales for the Indian auto component industry and the pace of growth in the segment is expected to moderate in FY2025. Growth in replacement demand is pegged at five to seven percent, after two to three years of healthy growth, following a relatively weak Q1 in the current fiscal. Exports, which account for close to 30 percent of the industry’s revenues, are likely to be impacted by subdued growth in end-user markets. Nevertheless, ancillaries will benefit from supplies to new platforms as the global OEMs diversify their vendor base and increase outsourcing.”

The moderation in revenue growth in FY2024-25 expected to stem from a moderation in the growth pace of domestic OEMs, the Indian auto components industry is poised to face the consequences of new vehicle registrations in Europe and the US on the exports front. The markets for vehicles over there are expected to remain tepid over the next few quarters, impacted by the weak global macroeconomic environment and geopolitical tensions. 

The rising supplies to new platforms because of vendor diversification initiatives by global OEMs/Tier-I players and higher value addition are expected to drive growth and stability in the auto components industry. 

An increase in outsourcing should augur well for the Indian auto component exporters and those suppliers that are into metal casting and forgings will experience better traction as plants in European Union wind up on the back of viability challenges. 

The aging of vehicles and rising sales of used vehicles in various markets of the world is expected to ensure good demand for suppliers that are into the aftermarket and export of components for the replacement segment. 

Over the medium-to-long term, the ICRA report mentions that stable growth in the auto components space will be fueled by electric vehicle (EV) linked opportunities, premiumisation of vehicles, focus on localisation and changes in regulatory norms. 

The disruption along the Red Sea resulting in a surge in container rates by two to three times in the year-to-date 2024 calendar year, the auto components industry will need to proactively track and tread caution from a supply chain point of view the sudden increase in shipping time by about two weeks. About two third of the exports from India are the US and Europe.

“ICRA’s interaction with large auto component suppliers indicates that the industry has incurred a capex of over Rs 20,000 crore (INR 200 billion) in FY2023-24 and is estimated to spend another Rs20,000-25,000 crore (INR 20-25 billion) in FY2024-25. The incremental investments would be made towards new products, product development for committed platforms, and development of advanced technology and EV components, apart from capex for capacity enhancements and upcoming regulatory changes. R&D, though, is still at an average of one to three percent of operating income, significantly lower than the global counterparts. ICRA expects auto ancillaries’ capex to hover around eight to 10 percent of operating income over the medium term, with the PLI scheme also contributing to accelerating capex towards advanced technology and EV components,” explained Vinutaa.

Image for representation purpose only.

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GAC International and Grab have established a strategic partnership to deploy 20,000 electric vehicles (EVs) across six Southeast Asian countries within the next two years. The agreement, signed on 7 January 2025, marks a shift for GAC from product exports to the expansion of an integrated ecosystem comprising products, services and data.

The collaboration focuses on the introduction of three models under the AION brand: the AION Y, AION ES and AION V. These vehicles will be integrated into Grab's fleet to serve the taxi and ride-hailing segments. The AION V, which holds a Euro NCAP five-star safety rating, is positioned as the flagship SUV for the region, while the AION Y and ES models target the high-volume electric taxi market.

Beyond vehicle supply, the companies intend to integrate the Grab driver app directly into GAC’s intelligent cockpit systems. This technical link is designed to improve order acceptance efficiency and driver safety. The partnership also covers the development of aftersales support, data value mining and charging infrastructure to support the large-scale deployment of EVs in the region.

Xia Xianqing, President of GAC Group, attended the exchange, while the agreement was signed by Wang Shunsheng, Vice President of GAC International, and Dylan Choon, Regional Manager of Strategic Partnerships at Grab.

The move comes as the Southeast Asian EV market reported a 50 percent YoY sales increase in 2024. By leveraging Grab’s user base, GAC aims to build brand awareness and gather market insights for future model development. The initiative is intended to reduce regional transport emissions in line with carbon neutrality targets.

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Visteon Corporation has announced an expanded technology partnership with Mahindra & Mahindra that will see its next-generation SmartCore Pro cockpit domain controller deployed in Mahindra’s XUV7X0 SUV lineup.

Unveiled at CES 2026, the SmartCore Pro builds on the SmartCore system introduced in the Mahindra XUV700 in 2021. The new system integrates cockpit electronics, surround view camera technology and telematics on Mahindra’s Adrenox+ platform. It features a three-display configuration supporting vehicle information, infotainment, ADAS visualisation and connectivity, alongside an integrated 360-degree camera system.

Francis Kim, Vice-President of Global Sales & Commercial Excellence and General Manager for Rest of Asia, Visteon, said, “The automotive industry is shifting from discrete systems to fully integrated digital platforms, and India is among the fastest-moving markets in this transition. This partnership demonstrates how strategic OEM collaboration can accelerate time-to-market for complex technologies while laying the foundation for software-defined vehicles.”

Alongside the Mahindra announcement, Visteon also showcased the production specifications and OEM implementations of its High-Performance Compute solution built on the Snapdragon Cockpit Elite platform. The solution follows Visteon’s collaboration with Qualcomm Technologies announced at Auto Shanghai 2025 and is now being demonstrated with multiple global OEMs.

The High-Performance Compute platform supports centralised vehicle architectures and software-defined vehicle strategies. It enables on-device AI processing, multi-display support, multi-user experiences and personalised cockpit features. The system uses the Qualcomm Oryon CPU, Qualcomm Adreno GPU and enhanced NPU AI performance, while Visteon’s cognitoAI Concierge digital assistant operates using the company’s QWEN 7B model.

Uday Dodla, Vice-President, Product Management, Visteon, said, “This High-Performance Compute solution addresses a critical challenge our OEM partners face as they transition to centralized architectures. By consolidating multiple ECUs into a single, powerful platform, we're enabling automakers to reduce complexity and costs while delivering the sophisticated AI-driven experiences that consumers increasingly expect.”

Mark Granger, VP, Product Management at Qualcomm Technologies, said, “Visteon's demonstration of its High-Performance Compute solution on the Snapdragon Cockpit Elite platform highlights the momentum toward centralized, software-defined architectures that will power the next era of intelligent, connected vehicles.”

Visteon said the platform is designed to support a common architecture across vehicle segments, allowing OEMs to scale features while consolidating electronic control units and supporting long-term cost efficiencies.

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French tier 1 supplier Valeo and Hero MotoCorp, the world’s largest manufacturer of motorcycles and scooters, have inked a strategic partnership for Advanced Rider Assistance Systems (ARAS).

The partnership will focus on enhancing rider safety by introducing advanced sensing, perception and intelligent technologies tailored specifically for two-wheelers across both entry-level and premium segments, including the OEM’s emerging electric mobility portfolio under VIDA. 

As part of the understanding, they will focus on ARAS by leveraging Valeo’s radar and smart camera tech equipped in Hero MotoCorp’s two-wheeler portfolio. This will not only enhance safety for two-wheeler users in India, but is also expected to drive awareness amongst customers globally.

The partners state that they have already achieved success in its proof-of-concept systems designed to protect both riders and pedestrians.

Marc Vrecko, CEO, Valeo’s Brain Division, said, “We are truly excited to partner with Hero MotoCorp to deliver solutions that will significantly enhance rider safety and create a more secure riding experience for millions of people. This collaboration is a key step in our strategy to bring advanced technology to the rapidly growing mobility market in India and globally.” 

Ram Kuppuswamy, COO, Plant Operations, Hero MotoCorp, said, “At Hero MotoCorp, we are redefining the future of mobility by bringing advanced technology to our products. Our partnership with Valeo marks a significant stride in making mobility smarter, safer and more sustainable with next-gen advanced rider assistance systems. Together, we aim to make two-wheeler safety accessible to everyone and set new standards for innovation and protection globally.” 

The ARAS architecture is developed as a digital co-pilot for riders, providing a 360deg safety envelope around the vehicle, it provides real-time sensing and intelligent alerts. It uses a radar-based system that can provide critical information/warnings such as Forward Collision Warning (FCW), Distance Warning (DW), Lane Change Assist (LCA), Blind Spot Detection (BSD) and Rear Collision Warning (RCW).

On the other hand, the vision system uses high-resolution cameras to provide Pedestrian Detection, Lane Detection, Traffic Sign Recognition and Lane Departure Warning.

Through intelligent image processing the system identifies road signs and obstacles, even in low-light conditions. Through the combination of radar and vision system, the two-wheeler encompasses a comprehensive safety system for two-wheeler users.

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SiMa.ai has announced its first integrated capability resulting from a collaboration with Synopsys. The joint solution provides a blueprint to accelerate architecture exploration and virtual software development for automotive Systems-on-Chip (SoCs). These chips support applications including Advanced Driver Assistance Systems (ADAS) and In-Vehicle Infotainment (IVI).

The partnership aims to deliver architectures required for software-defined vehicles. The blueprint allows customers to begin the design and validation of custom AI SoCs and ‘shift left’ software development before silicon is available. This process is intended to reduce development costs and accelerate vehicle time-to-market.

The blueprint provides pre-integrated SoC virtual prototypes and a tool workflow using solutions from both companies.

For Architectural Exploration:

• SiMa.ai MLA Performance and Power Estimator (MPPE): Enables customers to size machine learning accelerator designs for specific workloads.
• Synopsys Platform Architect: Used to model workloads and analyse performance, power, memory, and interconnect trade-offs before RTL design.

For Verification and Validation:

• Synopsys Virtualiser Development Kit (VDK): Facilitates software development using a virtual SoC prototype, which can accelerate vehicle time-to-market by up to 12 months.
• SiMa.ai Palette SDK: Supports machine learning workflows for edge AI applications.
• Synopsys ZeBu Emulation: Delivers pre-silicon hardware and software validation to ensure architectures meet workload requirements.

Krishna Rangasayee, Founder & CEO at SiMa.ai, said, "We are pleased with how well the two teams have worked together to quickly create a joint solution uniquely focused on unlocking physical AI capabilities for today's software defined vehicles. Our best-in-class ML platform, combined with Synopsys' industry-leading automotive-grade IP and design automation software creates a powerful foundation for innovation across OEMs in autonomous driving and in-vehicle experiences."

Ravi Subramanian, Chief Product Management Officer, Synopsys, said, "Automotive OEMs need to deliver software-defined AI-enabled vehicles faster to market to drive differentiation, which requires early power optimisation and validation of the compute platform to reduce total cost of development and time to SOP. Our collaboration with SiMa.ai delivering an ML-enabled architecture exploration and software development blueprint supported by a comprehensive integrated suite of tools significantly jumpstarts these activities and enables our automotive customers to bring next-generation ADAS and IVI features to market faster."

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