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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Spanish powertrain major Horse Powertrain and Repsol have announced the development of a hybrid powertrain designed to run on 100 percent renewable petrol. The HORSE H12 Concept engine achieves a peak brake thermal efficiency (BTE) of 44.2 percent and is intended to reduce vehicle fuel consumption.

According to WLTP testing, a vehicle equipped with this powertrain consumes less than 3.3 litres per 100 kilometres, representing a 40 percent reduction compared to 2023 European passenger car averages. When operated with Repsol’s renewable fuel, a mid-size car driving 12,500 kilometres annually emits 1.77 tonnes of CO2 less than a vehicle using traditional combustion technology.

The H12 Concept is an evolution of the HR12 engine and incorporates several engineering updates:

• Combustion System: Features a 17:1 compression ratio.
• Exhaust Management: Utilises a next-generation exhaust gas recirculation (EGR) system and an optimised turbocharger.
• Ignition: Includes a high-energy ignition system.
• Transmission: Features a hybrid gearbox with energy management and lubricants designed by Repsol to reduce internal friction.

Teams from the Horse Technologies Division in Valladolid and the Repsol Technology Lab in Madrid have validated two prototypes. A demonstrator vehicle is scheduled for presentation in early 2026. The companies state that this project is a step towards the industrial production of high-efficiency hybrid engines.

Repsol has commenced industrial-scale production of 100 percent renewable gasoline at its Tarragona facility. This fuel is compatible with existing gasoline engines and is currently distributed at 30 service stations in Spain under the Nexa 95 brand.

Patrice Haettel, COO, Horse Powertrain and CEO at Horse Technologies, said, “The HORSE H12 Concept is an example of how highly efficient engines and renewable fuels can reduce emissions today, without waiting for future solutions. As a company, we believe that relying on a single technology is not the fastest way to cut emissions. This is why we advocate a technology neutral approach that enables innovation across all solutions - electric, hybrid, range extenders and low-carbon fuels.”

Luis Cabra, Deputy CEO, Repsol, added, “This collaboration shows that decarbonisation can be accelerated through innovative and accessible technological solutions. The use of 100 percent renewable fuels is a net zero emission solution, complementary to electric vehicles, for decarbonising the transport sector. Supporting clear and ambitious regulation that drives investment in renewable fuels and highly efficient engines is essential for Europe to reduce transport emissions faster in a more competitive and effective manner.”

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Valeo has announced that its extended reality (XR) gaming experience will enter series production on the Renault Filante, the flagship vehicle from Renault Korea. The system, titled ‘R:Racing’, is based on the Valeo Racer concept unveiled at SXSW in 2024.

The technology represents the first XR gaming experience integrated into a production vehicle. It utilises existing sensors, cameras and hardware to blend virtual gameplay with the live environment. By synchronising gameplay with vehicle motion, the system is designed to reduce the sensation of motion sickness often associated with in-car screens.

The integration into the Renault Filante demonstrates how software-defined vehicle architectures can repurpose hardware for digital experiences. The system uses real-time data and sensor fusion to create a motion-synchronised experience for passengers.

The Renault Filante, developed and produced in Korea, is a crossover featuring connectivity and digital interfaces. The vehicle serves as the launch platform for Valeo's shift from automotive engineering into immersive cockpit technologies.

Marc Vrecko, CEO, Valeo Brain division, said, “The transition of the original Valeo Racer concept to series production is a clear illustration of how Valeo turns innovation into concrete customer value within a short period of time. Together with Renault Korea, we are redefining the in-car experience by combining perception technologies, software and creativity to make mobility more engaging, without compromising safety.”

Nicolas Paris, CEO, Renault Korea, added, “The Renault Filante embodies our ambition to deliver vehicles that combine emotional design, advanced technology and meaningful digital experiences for our customers. Working closely with Valeo on this world-first XR gaming production feature demonstrates the strength of our partnership and our ability to bring cutting-edge innovation from concept to reality.”

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German engineering company FEV recently released analysis on the economic efficiency of electrified commercial vehicles, suggesting that range extender architectures (REEV/Hybrid BEV) can reduce total cost of ownership (TCO) compared to diesel trucks.

According to data from FEV’s research programme, TCO can be reduced by up to 33 percent depending on the driving cycle. In long-haul scenarios, the analysis indicates a cost reduction of approximately 14 percent. These figures are based on European usage profiles involving depot charging at industrial electricity rates of 19 cents (INR 20-21) per kilowatt hour.

The study identifies reduced battery size as a primary factor in cost-effectiveness. A REEV truck operates with approximately 280 kWh of battery capacity, compared to the 560 kWh required by purely battery-electric (BEV) long-haul trucks.

The smaller battery allows for overnight charging via 22 kW AC infrastructure, providing enough energy for daily operations without the immediate requirement for megawatt charging stations. This reduces vehicle weight and increases payload capacity.

FEV reports that REEV trucks can be integrated into existing depot structures, reducing investment risks for operators. Beyond costs, the analysis suggests a reduction in global warming potential of up to 82 percent compared to diesel vehicles, depending on the energy mix used.

The company is currently developing demonstrator vehicles to validate these findings and translate the data into market-ready solutions for the commercial vehicle segment.

Dr. Norbert W. Alt, COO, FEV Group, said, “Our analysis clearly shows that the range extender makes electric trucks immediately economically and ecologically viable – without waiting for the widespread expansion of high-performance charging infrastructure. This is precisely what is crucial in long-distance transport.”

“Range extender-based Hybrid BEV trucks offer an immediately available, economically highly attractive solution for electrified long-distance transport. They combine high electric driving ranges with minimal infrastructure requirements – and deliver measurable added value precisely where cost decisions are particularly sensitive,” Dr Alt concluded.

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EQONIC Group, a UK-based battery technology company, has announced two senior leadership appointments to support the commercialisation of its lithium-free, sodium-free and rare-earth-free battery technology.

John Saunders joins as Executive Director, bringing 30 years of experience in banking, regulation and law. He has held senior roles at Coutts, Barclays, UBS and Deutsche Bank. On the other hand, Angela Knight CBE joins as Non-Executive Director, having previously served as Chief Executive of the British Bankers' Association and Energy UK, with board experience at Taylor Wimpey and Arbuthnot Banking Group.

EQONIC is developing proprietary technology that eliminates the use of lithium, sodium, and rare-earth metals. The company claims that its technology achieves materials cost savings of approximately 70 percent compared to traditional lithium batteries.

The technology utilises abundant materials that are non-flammable, which reduces the risk of thermal runaway. This approach is intended to address supply chain vulnerabilities and ensure the batteries are fully recyclable.

The company plans to license its technology to Original Equipment Manufacturers (OEMs) to enable global deployment while reducing capital risk. EQONIC’s roadmap aims for its technology to surpass sodium battery performance by 2026 and reach Nickel Manganese Cobalt (NMC) levels by 2029.

Currently, EQONIC operates a commercial division serving D2B and B2B clients with lithium iron phosphate (LFP) energy storage systems. The company has secured a multi-million-pound pipeline across multiple sectors.

John Saunders, Executive Director, EQONIC Group, said, "EQONIC's breakthrough technology represents a genuine paradigm shift in the battery sector. The combination of cost reduction, enhanced safety, and sustainable materials addresses the fundamental barriers that have constrained the industry. I'm excited to bring my experience to support the company's growth trajectory as we move toward demonstrating market-ready products and securing strategic partnerships."

Angela Knight CBE, Non-Executive Director, EQONIC Group, said, "EQONIC exemplifies the kind of innovative British technology that can lead global markets. The company's approach - developing transformative technology first, then building robust commercial frameworks around it, is hugely compelling. Strong governance will be critical as EQONIC scales its business model and establishes partnerships with established OEM’s. I look forward to contributing to the board's strategic oversight during this pivotal phase."

Jas Kandola, Founder and CEO, EQONIC Group, stated, "John and Angela bring exactly the calibre of leadership we need at this critical juncture. John's regulatory expertise and commercial acumen will be invaluable as we navigate partnerships and licensing arrangements, while Angela's governance experience across complex, regulated industries will strengthen our board oversight. These appointments reflect our commitment to building a world-class organisation capable of delivering on the enormous potential of our technology."

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