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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Bengaluru-headquartered ER&D company L&T Technology Services (LTTS) has announced a multi-year engagement within its mobility segment from an automotive manufacturer. The agreement involves software, connectivity and digital engineering services across vehicle technology domains. This win follows the company’s investments in R&D labs and mobility infrastructure designed for programs with global manufacturers.

The engagement covers mobility engineering capabilities, including embedded systems, digital platforms, verification and validation, cloud integration and cybersecurity. LTTS intends to use its engineering expertise and delivery frameworks to support the customer's technology roadmap. 

At present, LTTS operates 22 design centres and 100 innovation labs globally.

The agreement strengthens the partnership between LTTS and the automotive manufacturer in the area of mobility engineering. The company provides design, development, and testing services across the mobility, sustainability, and tech segments. 

Alind Saxena, Executive Director and President, Mobility and Tech at L&T Technology Services, said, “We are proud to deepen our partnership with the valued customer through this strategic engagement. LTTS brings together domain-led engineering, secure development practices and excellence in global delivery to accelerate the future of premium mobility. The win reflects the trust placed in our teams and our commitment to delivering world-class engineering at scale”.

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French technology company Valeo and NATIX Network have announced a partnership to develop a multi-camera World Foundation Model (WFM). The project combines Valeo’s research in artificial intelligence and generative modelling with NATIX’s decentralised physical infrastructure network (DePIN) to create an open-source platform for autonomous driving and robotics.

The initiative aims to move beyond perception-based models by creating a system capable of predicting future states and reasoning about physical interactions in a four-dimensional environment. The model will be trained using NATIX’s data network, which has collected 600,000 hours of video data across the US, Europe and Asia over seven months. This data provides the multi-camera inputs necessary for the spatial perception required by autonomous vehicles and robots.

The partnership builds upon Valeo’s existing open-source frameworks, VaViM (Video Autoregressive Model) and VaVAM (Video-Action Model). While these frameworks were previously trained primarily on front-camera datasets, the integration of NATIX’s multi-camera network expands the AI’s field of vision to 360 degrees.

Under the open-source framework, the partners will release models, datasets and training tools. This approach is intended to allow the research community to fine-tune models and benchmark physical AI across various driving conditions and geographic regions. The collaboration seeks to accelerate the deployment of end-to-end AI models by learning from real-world edge cases captured by vehicles in operation.

Marc Vrecko, Chief Executive Officer, Valeo’s Brain Division, said, “Since our creation in 2018, Valeo’s AI research center has been at the forefront of AI research in the automotive industry, especially in the fields of assisted and autonomous driving. Our goal has always been to advance mobility intelligence safely and responsibly. By combining Valeo’s generative world modeling research expertise with NATIX’s global multi-camera data, we are accelerating both the quality and the accessibility of next-generation end-to-end AI models, enabling the research community to build upon strong open models.”

Alireza Ghods, CEO and Co-Founder, NATIX, added, “WFMs are a once-in-a-generation opportunity — similar to the rise of LLMs in 2017–2020. The teams that build the first scalable world models will define the foundation of the next AI wave: Physical AIs. With our distributed multi-camera network, NATIX has a clear advantage of being able to move faster than large OEMs.”

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Tata Technologies has announced the completion of the 3^rd edition of its innovation hackathon, InnoVent 2026, supported by Amazon Web Services (AWS). The initiative invited engineering students to develop solutions for mobility challenges in the automotive and manufacturing sectors. The programme received participation from 10,247 students across 404 colleges in India, resulting in 2,822 projects.

The competition focused on the theme of intelligence-driven mobility for the year 2030. Participants received over 650 hours of mentoring and training from subject matter experts to convert their concepts into prototypes. The top 10 teams presented their work at the company's Hinjewadi campus in Pune before a jury of industry leaders from Jaguar Land Rover, Air India and ES-Tec Group.

Team Drushti from CMR College of Engineering & Technology, Hyderabad, secured the first prize of INR 300,000 for a system that customises vehicle infotainment for visually impaired drivers. Second place went to Team The T-Factor from Vellore Institute of Technology, Chennai, for an AI-based breakdown prevention system. Team SwarmSync from the International Institute of Information Technology (I²IT), Pune, took third place for an intelligent fleet management solution using V2X communication.

Tata Technologies offered career opportunities to all 42 finalists involved in the top projects. Furthermore, all participants were granted one-year access to the iGETIT learning platform to study emerging technologies. The finalist projects covered areas such as blockchain for vehicle security, wireless charging for electric vehicles, and AI-led battery monitoring.

The event featured a humanoid robot that performed roles such as coordinating panel discussions and interacting with attendees. A panel of industry experts discussed the global demand for engineering talent and the impact of technology on future mobility.

Warren Harris, MD & CEO, Tata Technologies, said, "InnoVent at Tata Technologies represents our conviction that the future is shaped by those who combine engineering excellence with human purpose to engineer a better world".

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Kia India has announced the re-launch of its Kia Inspiring Drive (K.I.D) Program, debuting alongside the New Kia Seltos. The initiative is a driving score system designed to monitor real-time behaviour and provide insights into habits. Accessed via the Kia Connect app, the programme will be rolled out across the company’s connected vehicle portfolio in phases.

The K.I.D score is calculated using a three-month rolling average based on parameters including rapid acceleration, rapid deceleration and sudden starts. To ensure data accuracy, the system applies a weighted value based on the specific vehicle. This methodology aims to reflect long-term driving patterns rather than isolated incidents.

The programme incorporates community-based leaderboards, allowing owners to compare scores and track their standing within the Kia community. By turning road safety into an interactive experience, the manufacturer intends to encourage responsible driving through recognition and competition.

The behaviour-based scoring system provides data to help users understand the impact of their habits on road safety. Kia is supporting the re-launch with a digital and press campaign to increase awareness among its customer base.

Atul Sood, Senior Vice-President – Marketing & Sales, Kia India, said, “Safety remains at the core of Kia’s philosophy, and with the re-launch of the Kia Inspiring Drive program alongside the New Seltos, we are taking another meaningful step towards encouraging responsible driving behaviour. By offering customers clear, data-driven insights into their driving patterns, the KID program empowers them to make safer choices on the road, while also enhancing their overall ownership experience.”

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