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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Faraday Future Intelligent Electric Inc. has released technical details regarding the Front AI Communication Ecosystem (F.A.C.E.), a system featured on the electric version of its FX Super One MPV.

The technology replaces the traditional front grille with a display and an AI avatar designed to act as a co-pilot and communication interface.

The system utilises multimodal interaction, including voice, gesture and touch, to respond to user needs. It is controlled via a smartphone application, allowing for the display of custom graphics, logos and streaming video while the vehicle is stationary. The hardware incorporates sensors that enable the AI agent to perceive its surroundings and interact with individuals outside the vehicle.

The F.A.C.E. system uses a Large Language Model (LLM) reasoning layer to interpret user intent and execute actions. Its functionality includes role-awareness personalisation, which distinguishes between owners, family members and unknown persons to provide appropriate responses.

The system supports proactive communication, such as initiating responses when someone approaches the vehicle to improve safety. Users can also interact with the vehicle’s voice assistant from the exterior to check status or request access. The FX Super One platform is engineered to support both battery electric and AI hybrid extended range (AIHER) powertrains.

The FX Super One is positioned as a mass-market MPV for the United States. Faraday Future has established a three-stage delivery structure for the model:

• Phase One: Deliveries to FX Partners are expected to begin in the second quarter of this year.
• Phase Two: B2B partner deliveries and production ramp-up are scheduled for the third quarter.
• Phase Three: Full-scale consumer market deliveries are targeted for the final quarter of this year or the first quarter of 2027.

Max Ma, Global CEO, FX, said, “Offering technology like our unique F.A.C.E system in a new category of vehicle will be a game changer in the marketplace. It will allow users to connect with the world in a totally new way. It can express itself and communicate to the world in a way never seen before in a vehicle. The FX Super One is not just a new MPV, it is the first mass-market, first-class Embodied AI MPV designed for the U.S. market, where intelligent space, AI interaction, sensing, computing and power and extended-range capability come together in a single platform.”

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German component supplier Schaeffler is leading the ReDriveS research project, an initiative funded by the German Federal Ministry for Economic Affairs and Climate Action. The project, which includes 25 partners from industry and academia, aims to develop an automated and scalable recycling concept for electric axle drive systems.

The project has a volume of over EUR 25 million, with funding exceeding EUR 16 million over a 36-month period. The technical focus is on robot-guided disassembly to recover materials such as rare earths, copper, aluminium and steel. This approach is intended to support the repair of drives, the reuse of subcomponents, or the recycling of materials to meet statutory requirements and secure supply chains.

A central component of the project is the development of a digital twin that processes data throughout the lifecycle of an axle drive. This digital model assesses the condition and geometry of units to determine whether they should be dismantled into main components – such as the motor, inverter, or transmission – or broken down further for material recycling.

The system is designed to be manufacturer-independent, allowing the technology to be used as an industry solution for original equipment manufacturers (OEMs) and recyclers. The project also explores data-based business models for axle drives enabled by this digital ecosystem.

Prof. Dr. Tim Hosenfeldt, Head of Central Technologies at Schaeffler, said, “With ReDriveS, we are launching a key project for the circular economy in electric mobility as consortium leader, together with the German Federal Ministry for Economic Affairs and Energy and strong partners. Our goal is to make electric axle drives significantly more resource-efficient through digital twins, automated disassembly and high-quality recycling – thereby securing raw materials and supply chains, reducing CO2 emissions, and strengthening Germany as a location overall.”

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BYD has updated its warranty terms for the Blade Battery in Europe, increasing the mileage limit to 250,000km while maintaining the 8-year duration. The extension applies to both battery electric vehicles (BEVs) and Super Hybrids and includes a guaranteed State of Health (SOH) of at least 70 percent. This change is retroactive, covering existing owners alongside new customers.

The Blade Battery utilises lithium iron phosphate (LFP) chemistry, which avoids the use of nickel and cobalt. Its design allows cells to act as structural elements, increasing the vehicle's torsional rigidity. This configuration reduces the volume occupied by the battery by 50 percent compared to traditional designs, intended to optimise interior space.

The battery has undergone testing, including nail penetration, where surface temperatures remained below 60deg Celsius. It has also been subjected to overcharge tests, oven tests at 300deg Celsius, and crush evaluations. According to BYD, the battery can exceed 3,000 charge and discharge cycles, indicating a service life of approximately 1.2 million kilometres.

Current models utilising this technology include the BYD SEAL, which reports a range of 570km on the combined cycle and the BYD SEALION 7, capable of DC charging from 30 percent to 80 percent in 18 minutes at a power of 230 kW.

Under the new terms, the specific battery cover sits alongside the standard vehicle warranty of six years or 150,000km. The electric drive unit remains covered for eight years or 150,000km, while the anti-perforation warranty continues at 12 years with unlimited mileage. The extension is designed to address user confidence regarding the longevity of energy storage systems in the European market.

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Suzuki R&D Center India (SRDI), a subsidiary of Suzuki Motor Corporation, has launched the Suzuki e-Micromobility Innovation Lab for Ecosystem (SMILE). Located within the International Automobile Center of Excellence (iACE) in Gandhinagar, Gujarat, the facility functions as a platform to develop Versatile micro e-Mobility (VmeM) solutions.

The laboratory connects technology from Japan with ideas from Indian startups and component manufacturers. The objective is to design mobility systems from a customer perspective and strengthen co-creation within the Indian ecosystem. The VmeM platform, previously announced in Japan as MITRA, was showcased during the Vibrant Gujarat event in Rajkot on 11-12 January before the opening ceremony on 13 January.

SMILE operates within iACE, an institution founded in 2015 by the Government of Gujarat and Maruti Suzuki India. The centre focuses on training and skill development, having provided education to over 10,000 individuals in automotive engineering and mobility systems. The establishment of SMILE follows a memorandum of understanding signed between iACE and SRDI in December 2024.

The lab intends to integrate vehicle manufacturing with technology from the startup sector to address infrastructure needs. Target applications include warehousing, air cargo, manufacturing plants, agriculture, and municipal services.

Katsuhiro Kato, Director and Executive Vice-President, Suzuki Motor Corporation, said, “We are pleased to see the VmeM, designed and developed by Suzuki, introduced in India through Suzuki R&D Center India. The VmeM platform represents Suzuki’s commitment to evolving future mobility. With the launch of SMILE at iACE, we will work closely with Indian industry, startups and government stakeholders to drive co-creation on valuable mobility solutions that support growth and sustainability. We also aim to serve the role as a key base for the global deployment of the VmeM platform by promoting continuous technological development.”

The initiative positions Gujarat as a base for the global deployment of the VmeM platform through ongoing technological development and stakeholder collaboration.

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