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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AutoVRse, a Bengaluru-based enterprise VR platform, has secured USD 2.4 million in a funding round co-led by Singularity AMC’s Large Value Fund III and Early Opportunities Fund, with continued participation from Lumikai. The investment arrives as automotive manufacturers face pressure from the EV transition, complex assembly, supply chain disruptions, labour shortage, and production line defects. Many of the world’s largest auto makers have already turned to AutoVRse’s technology.

The company provides VR simulation and smart-glasses-enabled field guidance for manufacturing, heavy industry and energy. It serves over 500,000 users across 50 enterprise clients in North America, Europe the GCC, and India, including Bosch, TVS Motors, Ashok Leyland, Tata Autocomp, Panasonic, KPIT and Godrej.

Three forces are driving Indian automotive interest in AI-driven training. The EV shift has made legacy internal combustion engine training obsolete, forcing manufacturers to rebuild training libraries. A shortage of skilled labour has made faster onboarding a necessity. AI-powered smart glasses now enable real-time guidance for line workers. Use cases include assembly training for new vehicle launches, EV battery safety, quality inspection and technician training for ADAS-equipped vehicles.

With the new capital, AutoVRse plans to expand its smart-glasses-based guidance product, which it believes will become standard on assembly lines within two years. It also aims to scale its North American presence, where deployments are running at several Fortune 500 firms, while strengthening its dominance in India and the GCC.

Ashwin Jaishanker, Co-Founder and CEO, AutoVRse, said, “AutoVRse moves safety and training culture from documentation to evidence. Our training products meet workers where they are – e-learning modules, dynamic SOPs, VR simulations – so they're certified before they ever go on-site. Our AI products replace tedious safety busywork like form-filling and performative inspections with real intelligence: helping workers make better decisions in dangerous situations or catch unsafe conditions before they arise. We're grateful to Singularity AMC for backing this vision, and to Lumikai, who've believed in this bet for years.”

Vikram Jaish, Head – HSE, WCL Pipes Anjar, Welspun Corp, said, “Pipe coating operations involve multiple high-risk touchpoints where early hazard recognition is critical. With AutoVRse’s VR training, our teams can experience and identify these hazards in a realistic, controlled environment before stepping onto the shop floor. This has significantly improved awareness, preparedness and safe decision-making compared to traditional training methods.”

Yash Kela, Founder & Chief Investment Officer, Singularity AMC, said, “Most people think of AI in the context of consumer apps. AutoVRse is creating real impact with AI on the assembly line, and that is what our investment thesis is built on. The company operates at the intersection of AI and India's manufacturing revolution. We believe this is how the world will train and operate its industrial workforce over the next 10 years. AutoVRse sits at the edge of a massive, largely untapped market, and we believe the growth from here will be extraordinary.”

Aditya Deshpande, Principal, Lumikai, said, “We're thrilled to deepen our partnership with AutoVRse as they build out cutting-edge AI and VR infrastructure for Fortune 500 enterprises. With VRseBuilder, AutoVRse has demonstrated how immersion, participation and personalisation are finding consequential real-world applications across industrial training in warehouses, labs, plants and field operations of high-precision industries such as pharma, life sciences, manufacturing and petrochemicals, globally. We're excited to back Ashwin, Adarsh and the team as they make immersive AI the operating layer for global industry.”

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European auto major Stellantis and American technology company Factorial Inc. have integrated solid-state battery technology into a Dodge Charger Daytona development vehicle and launched a road-testing programme. The initiative represents the first integration of solid-state cells into a Stellantis vehicle and the first automotive application of the technology in North America.

The development vehicle utilises Factorial's Factorial Electrolyte System Technology (FEST), which combines a lithium-metal anode with a solid polymer separator. In validation testing, the cells demonstrated a specific energy density of 375 watt-hours per kilogram (Wh/kg) and achieved a charging transition from 15 percent to 90 percent state-of-charge in 18 minutes. The cells also verified thermal stability across an operational temperature envelope spanning minus 30 degrees to 45 degrees Celsius.

Integrating the solid-state cells into a production-based car required a modification of the vehicle's battery enclosure. Stellantis designed and implemented a patented mechanical architecture to house the cells within the existing pack layout. Engineers also modified the electronic control systems and pack management software to optimise current distribution while satisfying automotive durability and crash safety regulations.

The newly initiated tracking and calibration programme on public roads will evaluate the performance, structural durability and overall safety of the modified pack under real-world driving and charging cycles. The project is a phase within a multi-stage development agreement between the two entities. Factorial, which recently listed on the Nasdaq exchange following a business combination, develops scalable battery technologies and counts Stellantis, Mercedes-Benz, Hyundai and Kia among its strategic investors.

Ned Curic, Chief Engineering and Technology Officer, Stellantis, said, "Battery development is a balancing act. It’s not enough to optimise a single metric. We need a system that delivers real benefits in a real vehicle. This milestone shows we are bringing solid-state batteries closer to our customers with the potential for longer range, faster charging and lower costs. Just as important, FEST’s strong compatibility with lithium-ion manufacturing processes gives us a critical path to scale this technology.”

Siyu Huang, CEO, Factorial, said, "We are deeply honoured to work alongside Stellantis, one of the world's great mass-market automakers, on this STLA Large-based development car. What we have built together, from cell chemistry to pack architecture to enable real-world road testing, is exactly the kind of deep, full-stack collaboration that solid-state has always required. This milestone doesn't just validate FEST; it sets a new bar for what automotive-grade solid-state batteries can deliver and supports the development of future vehicles designed to meet the evolving needs of drivers."

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German luxury carmaker Mercedes-Benz has officially launched large-scale series production of its new high-performance electric axial flux motor at its Berlin-Marienfelde facility.

Founded in 1902, the company’s oldest active manufacturing site is being transformed into a global centre of excellence for high-performance electric motor fabrication.

The compact, high-power-density drive system is making its commercial production debut on the front and rear axles of the new all-electric Mercedes-AMG GT 4-Door Coupe.

Bringing axial flux technology to automotive mass production required overcoming steep engineering barriers. The manufacturing footprint spans approximately 30,000 square meters across three production halls, utilising seven highly automated assembly lines.

The production workflow comprises 98 distinct process steps, including 65 deployed for the first time by Mercedes-Benz and 35 entirely new to the global manufacturing sector. These industrial innovations have generated more than 30 patent applications.

The axial flux motor, rather than using traditional round wire, uses rectangular copper wire to pack more conductive material into a tight space, boosting power density. Mercedes-Benz co-developed a high-speed bending process to shape the wire at tight radii without pinching, wrinkling or breaking the insulation coating.

The coil ends are connected to adjacent wires via ultra-precise laser welding. This delivers minimal, highly localised thermal input to prevent heat damage to surrounding plastic components.

Furthermore, drivetrain plastic parts undergo simultaneous laser transmission welding. To prevent geometric inaccuracies, an AI-driven optical system tracks component placement in real time, locks virtual protection zones over sensitive areas and verifies seal integrity instantly.

During final assembly, the stator is structurally integrated between two heavy, magnet-loaded rotor discs. The line manages massive magnetic pull forces of up to 9 kN (approx. 900 kg), keeping the stator perfectly balanced within the magnetic centre plane under a tight tolerance of less than 0.1 millimetres using micro-frequency control pulses.

The current motor design builds on early prototype architectures from British electric motor specialist YASA, which became a wholly-owned subsidiary of Mercedes-Benz in 2021.

Michael Schiebe, Member of the Board of Management, Mercedes-Benz Group AG (Production, Quality & Supply Chain), said, “With the start of large‑scale series production of the axial flux motor in Berlin‑Marienfelde, we are bringing a pioneering innovation for electromobility into industrial reality. In doing so, we are sending a strong signal of technological leadership, operational excellence and the transformation of the automotive industry in Germany."

Patrick Schnieder, German Federal Minister of Transport, noted, “Mastering the demanding axial flux technology is a major opportunity for the German and European automotive industry. This innovative electric motor helps establish a strong foothold in the premium segment. The start of production of the axial flux motor in Berlin-Marienfelde sends a powerful signal about Germany’s strength as an industrial location. With Mercedes-Benz’s axial flux motor, electromobility gains additional momentum. A decisive factor in the continued success of e-mobility is the availability of charging infrastructure. Through our Charging Infrastructure Master Plan 2030, we support both the considerable commitment of the charging infrastructure industry and the efforts of the automotive industry.”

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NXP Semiconductors has introduced the SAF8444, an automotive radar system-on-chip designed to enable advanced driver assistance systems (ADAS) processing on the sensor itself.

Manufactured using 28-nanometre RFCMOS technology, the single-chip solution operates across the 76–81 GHz automotive radar band to support short-, medium- and long-range sensing. The chip is intended for vehicle platforms, including electric vehicles, where it reduces system costs by simplifying thermal management and vehicle integration.

The system addresses entry-level and economy vehicle lines by integrating hardware components to lower overall bill-of-materials costs. It combines an Arm Cortex-A53 applications processor, an Arm Cortex-M7 real-time core, and NXP’s proprietary Signal Processing Toolbox radar accelerator with digital signal processor support. This architecture allows perception-level processing to occur directly on the radar sensor, reducing the data-load reliance on centralised vehicle compute resources.

The technology is optimised for standard automated safety functions, including adaptive cruise control, autonomous emergency braking, blind-spot detection and park assist. To meet safety criteria such as the Euro NCAP 2030 requirements, which include low-light pedestrian detection, the chip fuses camera and radar data.

Additionally, it features a dual-threaded accelerator to run anti-jamming algorithms and mitigate radio frequency interference in congested environments.

NXP supports the device with an enablement ecosystem that includes radar software development kits, safety frameworks, security components, power management integrated circuits, and networking solutions.

Meindert van den Beld, Senior Vice-President and General Manager, Radar & ADAS, NXP Semiconductors, said, “SAF8444 strengthens our one-chip radar portfolio with a solution that balances performance, power efficiency, and cost. It allows customers to meet tightening safety requirements while reducing system cost—an essential step toward democratizing ADAS adoption.”

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