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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Taiwan-headquartered Delta Electronics has announced a collaboration with NVIDIA aimed at developing autonomous driving systems for next-generation vehicles.

The partnership combines Delta’s automotive energy management, electric powertrain systems and in-vehicle high-performance computing system integration with the NVIDIA Hyperion reference platform and NVIDIA Halos safety system.

NVIDIA Hyperion serves as a sensor and compute architecture for Level 4 autonomous vehicles and robotaxis, utilising dual NVIDIA DRIVE AGX Thor processors to enable production-ready vehicle autonomy.

James Tang, Executive Vice-President of Mobility Business Category, Delta, said, "Autonomous driving requires years of technology development, continuous innovation, and strong system integration. Our commitment to the EV sector began several years ago, developing strong expertise in power electronics and key automotive technologies, and accumulating extensive development experience with world-class automakers. We are honoured that NVIDIA recognises Delta’s automotive expertise and strategic direction. Through this joint endeavour, we will further integrate AI and HPC capabilities into the enhancement of advanced autonomous driving functions, turning next-generation smart vehicles into real-world applications while pursuing new opportunities in the fast-growing smart mobility market."

Rishi Dhall, Vice-President of Automotive, NVIDIA, said, "Level 4 autonomous driving requires powerful in-vehicle computing, a comprehensive sensor architecture and close collaboration across the automotive ecosystem. By combining Delta’s automotive and system integration expertise with NVIDIA Hyperion, we can accelerate the development of safe, intelligent and scalable autonomous driving systems for the next generation of mobility."

Under the agreement, Delta will work alongside NVIDIA’s engineering teams to integrate its system technology into the Hyperion architecture, while leveraging NVIDIA's international network to broaden commercial engagement with global automotive manufacturers.

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Stellantis and Wayve will participate in the Wave by Vento event in Turin from 7 to 9 October 2026, featuring executive sessions, technical presentations and demonstration rides focused on artificial intelligence in mobility.

A keynote session titled ‘Technology Made for Humans’ will feature Stellantis CEO Antonio Filosa and Wayve Co-Founder and CEO Alex Kendall on 9 October. Moderated by Adam Jonas, global embodied AI and robotics strategist at Morgan Stanley, the discussion will focus on AI-powered mobility and strategic partnerships for technology deployment at scale.

During the event, Stellantis and Wayve will conduct demonstration rides in Fiat 500e and Maserati Grecale development vehicles equipped with the STLA AutoDrive platform powered by Wayve.

The system integrates the Wayve AI Driver to demonstrate hands-free, door-to-door supervised automated driving, categorised as Level 2++, in real-world driving conditions. The integration follows the Jeep Grand Cherokee development vehicle displayed at Stellantis' Investor Day in May, applying the same core AI driving software across three vehicle architectures without model-specific software re-engineering.

Announced in May 2026, the strategic partnership between Stellantis and Wayve focuses on supervised automated driving software for highway and urban environments. Stellantis targets its first commercial product launch using the technology in North America in 2028.

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Energy In Motion (EIM Ltd) has inaugurated a heavy-duty battery swapping-cum-charging station at Rewari, Haryana, expanding its energy infrastructure along the NH-48 Delhi-Mumbai freight corridor.

The facility was inaugurated by Dr. Hanif Qureshi, IPS, Additional Secretary, Ministry of Heavy Industries, Government of India. The event was attended by representatives from cement and logistics companies, fleet operators, financial institutions, and transport providers, including Mahendra Singhi, Board Member and Advisor at Dalmia Cement, Arun Kumar Khurana, Joint President and Head of Operations Logistics at UltraTech Cement, Manav Bansal, Co-Founder and CEO at Drivn and Narendra Murkumbi, Managing Director at Energy In Motion.

The Rewari station joins existing EIM facilities at Palwal and Kotputli along the NH-48 corridor. Each station operates with a connected load of 2.5 MW to supply power directly along key transit routes. The infrastructure utilises a battery-swapping model designed to replace depleted heavy-vehicle batteries with charged units, reducing vehicle idle time compared to stationary plug-in charging methods.

Narendra Murkumbi, MD, EIM, said, “The Rewari station is dedicated to support Green logistics more economically. The facility can swap a discharged battery of an Electric Heavy commercial vehicle (e-HCV) typically in 7 minutes, against 55-60 minutes of charging time through a conventional charger, there by yielding a significantly higher fleet availability and better economics for any fleet owner or transporter. The station has the capacity to serve over 150 vehicles a day. EIM’s Battery Swapping, together with its larger capacity battery of 350 kWh, can result into a 10 percent increment in the No. of monthly return trips on any corridor for any Logistics Service Provider (LSP). We plan to set-up 40 such stations across India in the current financial year, of which 8 are already operational and 7 more in various stages of installation. EIM, in its pursuit of creating value for its customers through innovative solutions, has already gained large traction across India through its ‘Maitryi’ model (Battery as a Service or BaaS) where a customer’s upfront capital deployment stands reduced by 40 percent while buying a heavy-duty electric truck, a capital-intensive item.”

EIM offers its infrastructure under a Battery as a Service (BaaS) commercial structure, designated as the 'Maitryi' model. The arrangement separates the vehicle purchase price from the battery unit, lowering initial capital expenditure for logistics providers purchasing heavy-duty electric trucks. The company plans to deploy 40 heavy-duty swapping-cum-charging stations across India during the current financial year, with eight facilities currently in operation and seven in development.

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Japanese tier 1 supplier Toyoda Gosei Co’s regional headquarters in China, Toyoda Gosei (China) Investment Co., has inked a partnership agreement for safety standards and technical innovations with CATARC Component Technology (Tianjin) Co., a group company of the China Automotive Technology & Research Center (CATARC).

The agreement focuses on safety standards and technical developments as China Automotive Technology & Research Center formulates vehicle safety regulations and industry standards in China.

As per the understanding, Toyoda Gosei (China) Investment Co., aims to accelerate product development by increasing the deployment of computer-aided engineering technology and creating safety products tailored to local requirements.

The partnership comes amid market shifts in China driven by the adoption of electric vehicles and the entry of new automotive manufacturers. Toyoda Gosei plans to leverage its engineering resources to supply safety components to carmakers operating within the Chinese automotive sector.

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