The global shortage of semiconductors or chips in the aftermath of the Covid-19 led pandemic has eased as per a report by Crisil. A development that led most automakers to cut down production significantly and postpone the launch of new models or to put them to production through 2020, 2021, 2022 and a good part of 2023 has finally eased to iron out any supply chain disruptions that may be there. 

Expected to address and improve predictive demand forecast, the better availability of chips should enable better production schedules. By FY2025-26, Crisil analysts are of the opinion that demand-supply dynamics should be more balance with additional manufacturing capacities getting commissioned. 

With the chips possessing distinct electrical properties that make them the cornerstone of all electronic equipment and devices, it is the auto industry that has come to use them for a variety of functions as automobiles turn increasingly software driven. While the computer and communication equipment (C&C) segment consumes roughly 63 percent of the chips produced, the auto industry consumes roughly 13 percent of them. The other industrial segments consume about 12 percent. 

With new developments such as autonomous and EVs, the use of semiconductors in automobiles is only slated to rise. With passenger vehicles the recipient of most technological innovations ahead of other segments such as two-wheelers, three-wheelers and commercial vehicles, it should not come as a surprise that they consume about 1,500 chips on average – the highest among all automobile types. 

As more advanced electronic features are incorporated, the use for chips increases. The electric passenger vehicles, for example, use almost twice as many chips as internal combustion engine (ICE) passenger vehicles do. The improving supply and slowing demand for computers and mobile phones is therefore looked upon as a blessing in disguise for automobiles and their manufacturers. 

Anuj Sethi, Senior Director, CRISIL Ratings, mentioned, “The chip shortage faced by Indian passenger vehicle makers is easing, with current availability at 85-90 percent of total requirement. The production loss on account of the chip shortage, which had halved to about 300,000 PVs on-year in fiscal 2023, is estimated to have further declined to under 200,000 PVs by the end of September 2023.”

Most passenger vehicle manufacturers are currently operating at near optimal capacity utilisation due to stronger-than-anticipated demand. New orders to be serviced remains high at about 700,000 units at the end of September 2023. 

The easing of chip shortage should help automakers honour new orders with better prediction and faster production. Global automobile demand, severely impacted by the Covid-19 pandemic, made a strong recovery in the latter part of FY2021-22. It caught automobile manufacturers off guard as they had not placed substantial orders for chips. 

The surge in demand for personal computers, laptops and mobile phones, driven by work from home, virtual learning and remote healthcare services, led to a significant chip procurement challenge for the automakers. 

Geographically, the chip ecosystem is skewed, with western nations dominating chip architecture, design, manufacturing equipment, specialised materials and chemicals. Semiconductor fabs1 on the other hand are concentrated in eastern nations, such as Taiwan and South Korea.

Given the criticality of chips in the defense and aerospace industries, the United States and the European Union have offered incentives of about USD 100 billion for localisation of semiconductor fabs. As a result, many global players are slated to spend about USD 360 billion towards setting up new facilities, which would be operational by 2025 and 2026. 

In the Indian context, demand for chips will continue to increase over the medium term, driven by the gradual rise in EV adoption and growing demand for advanced feature-laden ICE vehicles.

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L&T Technology Services has introduced AgenticIQ, a comprehensive Agentic AI platform tailored for engineering and manufacturing sectors. The end-to-end system is designed to facilitate the shift from isolated AI experiments to full-scale operational deployment. It achieves this by enabling autonomous, multi-agent workflows that span product development, manufacturing and customer experience, thereby promoting widespread Engineering Intelligence adoption.

Despite rising corporate AI investments, many projects remain stalled at the pilot phase due to fragmented engineering systems and manual processes. Highly regulated environments further complicate scalability, as organisations struggle to balance autonomous operations with strict governance and security protocols. AgenticIQ directly addresses these hurdles by embedding a planning-first architecture into existing production workflows.

Built upon LTTS’ existing Engineering Intelligence portfolio, the platform converts proven capabilities into reusable, specialised AI agents that function within enterprise governance frameworks. It ensures the protection of critical data and intellectual property while supporting a new agentic delivery model. With a cloud-agnostic design, the platform serves R&D-heavy industries like automotive, healthcare and semiconductors, allowing clients to deploy solutions anywhere without losing control over proprietary knowledge and workflows.

Amit Chadha, Chief Executive Officer & Managing Director, L&T Technology Services, said, “The next phase of Engineering Intelligence will be defined by how effectively autonomous AI agents collaborate to solve complex industry challenges across engineering, production and customer experience. Over the years, LTTS has built AI-powered engineering solutions that address domain-specific business problems across industries. With AgenticIQ™, we are transforming these proven capabilities into reusable AI agents on a unified Agentic AI platform that enables enterprises to rapidly build, orchestrate and deploy next-generation agentic solutions at scale.”

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German automotive major the BMW Group and its consortium partners have concluded the Car2Car research project, demonstrating that high-quality material recovery from end-of-life vehicles is technically feasible for industrial automotive applications.

Under expanded processing and sorting conditions, the consortium increased the percentage of recoverable materials from 6 percent to 51 percent across five focus material groups.

The project evaluated recovery paths for steel, aluminium, copper, plastics and glass. Under optimised processing routes, the recovery rate for steel rose from 1 percent to 81 percent, aluminium increased from 23 percent to 52 percent and copper grew from 48 percent to 68 percent. The improvements were achieved through pre-sorting, modified shredding processes, classification, sensor-based sorting and alloy separation.

Alexander Efthimiou, Senior Vice President Business Development, BMW Group, said, “The circular economy is an integral part of the BMW Group’s corporate strategy. Car2Car shows that its full potential can be realised when the entire value chain is optimised. Together with our partners, we are using the project findings to develop new process and business models that combine environmental and economic benefits, and advance the transition towards a circular automotive industry.”

To address copper contamination that prevents scrap steel from being reused in automotive flat steel, the project introduced a targeted sorting process for which a patent application has been filed. Steel coils produced through this method were tested at BMW Group Plant Leipzig, where over 100,000 series parts were manufactured and installed in vehicles.

Hilke Schaer, Car2Car project manager, BMW Group, said, “With Car2Car, we wanted to understand under which conditions materials from end-of-life vehicles can be reused in new cars. The project has shown the potential in current material streams from end-of-life vehicles that have not yet been optimised for high-quality material loops. The most significant progress was seen with steel: We were able to demonstrate that high-quality flat steel for automotive applications can be produced from end-of-life vehicle scrap. In the field test at BMW Group Plant Leipzig, more than 100,000 series parts were produced using this steel and installed in vehicles – making the project’s results tangible.”

While metal recycling yielded positive results, the consortium noted that technological challenges remain for plastics and glass due to material varieties and complex composite structures. Large-scale implementation across the industry will require process chains, additional infrastructure investments and regulatory frameworks aligned with the European ELV Regulation.

The consortium comprised BMW AG, TU Bergakademie Freiberg, the Helmholtz Institute Freiberg for Resource Technology, Technical University of Munich, Scholz Recycling, STEINERT UniSort, thyssenkrupp Steel Europe, Salzgitter Mannesmann Forschung, Aurubis, Novelis Germany, OETINGER Aluminium and Pilkington Automotive Germany.

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Cars24 has signed a Memorandum of Understanding (MoU) with the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, to support India's startup ecosystem through initiatives focused on artificial intelligence, mobility, and road safety.

As per the agreement, Cars24 will establish structured programmes for early-stage founders, granting access to its infrastructure, mentor network, funding sources, market connections and technical resources. In turn, the DPIIT will facilitate national outreach and ecosystem integration via the Startup India platform, supporting knowledge exchange, co-branding and policy engagement.

The partnership encompasses five specific areas of operation: mentorship for early-stage founders via the Cars24 Founders' Fellowship, training through Mobility and Autotech Skilling Programmes, technical support and AI integration via Cars24 Labs, investor connections through Fuel by Cars24 and the organisation of an annual Innovation Challenge and Road Safety Hackathon alongside the DPIIT.

Vikram Chopra, Builder, Cars24, said, “Cars24 is proof that Indian founders can start with a difficult, everyday problem and build something on a national scale. We want to pass that possibility on. Through this partnership with DPIIT, we are backing the next generation of builders with more than advice. We want to give them access, capital, talent and a real platform to test ideas that can make India move smarter and safer.”

A senior DPIIT official commented, “Industry participation is central to strengthening India’s startup ecosystem. Collaborations of this kind, where an established market leader opens up its scale, mentorship and resources to early-stage founders, are exactly the bridge between ambition and execution that young startups need. We welcome Cars24’s commitment to mentoring, skilling and supporting product startups across the country.”

The non-binding MoU establishes a framework for ongoing collaboration between both entities to foster technology adoption and entrepreneurship within the Indian mobility sector.

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NXP Semiconductors has announced that the BMW Group will deploy its Trimension NCJ29D6 Ultra-Wideband (UWB) family across its vehicle fleet, beginning with selected 2026 production programmes.

The hardware component integrates fine-ranging capabilities with short-range radar functionality on a single chip. This allows vehicle manufacturers to utilise a single system for multiple applications, including hands-free vehicle entry and occupant presence detection.

The integration supports BMW’s Digital Key Plus feature, which enables vehicle owners to substitute key fobs with smartphones or smartwatches. The system manages locking and unlocking functions as the user approaches or moves away from the vehicle. Additionally, the technology includes in-cabin radar monitoring designed to identify motion patterns consistent with occupants or animals left inside a parked vehicle, sending notification alerts to users to align with European and Chinese NCAP assessment protocols.

Markus Staeblein, Senior Vice-President and General Manager, Secure Car Access at NXP Semiconductors, said, “NXP’s proven Trimension UWB platform maximises value for OEMs, using a single system to deliver multiple new and differentiating features for drivers. Digital key and presence detection are just the beginning. OEMs will be able to deliver additional UWB-based features, such as kick sensing, intrusion alert or automatic charging, as they establish the secure hardware platform in their vehicles.”

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