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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L&T Technology Services (LTTS), a leading ER&D company, has announced a strategic partnership with thyssenkrupp Steering to set up a software development centre in Pune.

The partnership will bring together LTTS’ expertise in its mobility segment, dedicated to developing safety-critical software for advanced steering technologies, while thyssenkrupp will bring together its global engineering solutions.

As per the understanding, LTTS will establish and manage the software hub in Pune on behalf of thyssenkrupp Steering.

For the unversed, LTTS has expertise on vehicle engineering to next-gen software innovation, while thyssenkrupp Steering has been developing steering systems for many years. The company possesses a deep knowledge of new electrical/electronic (E/E) architectures and software, as well as strong competence in steering technology. Its activities also extend to forward-looking developments such as the Vehicle Motion Control system, which enables higher comfort, advanced safety and highly autonomous driving through the high-level integration of steering, brakes, drivetrain and dampers.

Richard Hirschmann, SVP R&D, thyssenkrupp Steering, said, “We are excited to partner with LTTS to expand our software capabilities in India. This centre will play a crucial role in driving innovation and delivering next-generation steering solutions to our global customers.”

Patrick Vith, CEO, thyssenkrupp Steering, stated, “We are driven by a clear strategic ambition: to be the most trusted partner for steering solutions worldwide. We aim to shape the future of mobility through innovation, operational excellence, and strong global partnerships.”

Amit Chadha, CEO & Managing Director, L&T Technology Services, said, “This collaboration with thyssenkrupp Steering highlights LTTS’ leadership in the mobility space. Our expertise in electrification, hybrid systems, and software-defined vehicle architectures drives intelligent, sustainable mobility, supported by over 250 programs, 350 patents and 45 labs. By adding a prominent Tier-I automotive partner to our portfolio, this partnership reaffirms our role as the go-to innovation partner for future-ready mobility solutions.

Rajkumar Ravindranathan, Chief Business Officer – EMEA & RoW, L&T Technology Services, said, “We are honoured to be part of this significant milestone in thyssenkrupp’s transformation journey. Through this partnership, and by leveraging our deep expertise in building safety-critical, software-led products, LTTS will deliver scale, faster time-to-market, and cost-effective innovation, enabling thyssenkrupp to sustain and grow its market leadership. The Pune center will serve as a hub for cutting-edge software development, including embedded systems, functional safety and cybersecurity, aligning with the growing demand for intelligent and connected vehicle technologies.”

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Accenture, a leading IT services and Management Consulting organisation, has partnered Centre of Excellence in Advanced Automotive Research (CAAR), a research society established by the Indian Institute of Technology Madras (IIT Madras), to offer specialised skilling programs through Accenture’s LearnVantage Software-Defined Vehicle (SDV) Academy.

Targetted towards automotive Original Equipment Manufacturers (OEMs) and Global Capability Centers (GCCs) the initiative aims to develop talent pool to build software-defined vehicles. The program aims to meet the growing demand for skilled professionals in the SDV domain by bridging the gap between traditional automotive roles and the digital skills needed to develop automated driving technology, advanced driver assistance systems (ADAS), electrical/electronic architecture, connectivity and infotainment systems.

The curriculum covers advanced Internet of Things (IoT), embedded systems and software, vehicle safety, communication protocols, cybersecurity, edge computing, cloud virtualisation and industry standards like AUTomotive Open System Architecture (AUTOSAR) and Automotive Software Process Improvement Capability Determination (ASPICE).    

Kishore Durg, Global Lead, Accenture LearnVantage, said, “As vehicles transform into sophisticated software-defined machines, the automotive industry requires digital-native talent skilled in AI, machine learning, cybersecurity, and safety systems. Our collaboration with CAAR at IIT Madras is a game-changer, focused on transforming talent at scale for OEMs and GCCs in the sector. Together, we are committed to rapidly upskilling and reskilling talent to embrace technological advancements and develop the interdisciplinary skills needed for the SDV landscape.” 

Prof. Krishnan Balasubramanian, Prof. in Charge of Center for Advanced Automotive Research (CAAR), IIT Madras, said, “The academia-industry partnership, enabled by the Center of Excellence CAAR is a unique model that creates a win-win for all parties and enables upskilling of the next generation workforce in new areas such as SDVs. We are delighted to be partnering with Accenture’s LearnVantage.”

Thiruppathy Srinivasan, CEO, CAAR, IIT Madras, said, “The automotive industry is rapidly evolving with the adoption of electrification, connectivity, and advanced smart technologies. The high-growth software-defined vehicle space demands both new digital skills and a larger pool of skilled professionals, making upskilling a top priority. Our collaboration with Accenture LearnVantage offers a synergistic platform to bridge the talent gap by equipping professionals with the competencies needed to thrive and meet the industry’s evolving needs.”  

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German luxury carbrand Audi has officially launched AirConsole's interactive gaming platform in select vehicles, marking a significant step forward in the evolution of in-car entertainment. This integration brings a suite of social games, playable using smartphones as controllers, directly to Audi's infotainment system, aiming to enhance the travel experience for non-driving passengers.

The games were previously limited to parked vehicles, but now in-car gaming in select Audi models can now be enjoyed while the car is in motion, specifically by the front passenger in vehicles equipped with a passenger display. This is made possible through Audi's Active Privacy Mode, a unique digital curtain that prevents the driver from being distracted by the screen.

Anthony Cliquot, CEO at N-Dream, the makers of AirConsole, said, “This is a game-changer for in-car entertainment. With Audi, we’re redefining what’s possible inside a vehicle – bringing gaming into motion and making every journey more social and fun. By enabling gameplay on the passenger screen in a way that prioritises safety – by not distracting the driver – we’re taking a bold yet responsible step toward a future where cars are not just modes of transport, but platforms for shared digital experiences.”

In a notable collaboration with Mattel, Audi and AirConsole are introducing Pictionary Car Party, an exclusive in-car edition of the popular quickdraw game. This launch coincides with Pictionary's 40th anniversary and allows up to four players to connect via their personal devices, transforming road trips into interactive gaming sessions.

Erika Winterholler, Head of Business Development, Digital Gaming at Mattel, said, “We’re thrilled to continue our partnership with AirConsole and work with the team at Audi to bring Pictionary Car Party! to Audi’s infotainment systems. This collaboration is a game-changer, letting non-driving passengers join in on fun, interactive play using their smartphones. Most importantly, the front passenger can safely control the game without distracting the driver, ensuring that entertainment and safety go hand-in-hand. This is the future of social gaming on the move, making every journey more enjoyable.”

Beyond Pictionary Car Party, the AirConsole platform offers an initial selection of 13 additional games spanning various genres, including racing, sports, trivia and party games. Notable titles include Who Wants to Be a Millionaire? from Sony Pictures Television, Overcooked from Team17, and UNO Car Party! from Mattel. Audi passengers can anticipate frequent updates and new content, ensuring an ever-expanding library of interactive entertainment.

Accessing AirConsole is designed to be straightforward. Users can download the AirConsole app directly through the Audi Application Store, which hosts apps specifically optimised for in-vehicle use. Passengers simply scan a QR code displayed on the vehicle’s screen with their smartphone to instantly connect and use their device as a game controller.

The AirConsole gaming platform is now available in the Audi A5, Q5, A6, A6 e-tron and Q6 e-tron model series equipped with Android-based infotainment systems, across all markets where Audi operates.

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German technology major Bosch has outlined its ambition to further continue investments towards development and deployment of artificial intelligence (AI). During the recently held Bosch Tech Day, the company announced that by end-2027 it will invest over EUR 2.5 billion towards AI alone.

In the last five years, the company has filed over 1,500 patent applications in the field of AI, making it a leading innovator globally. The company shared that despite slower-than-anticipated momentum of AI in both assisted and automated driving, it foresees huge potential in the long run.

Going forward, it expects the demand for software, sensor technology, high-performance computers and network components will more than double by mid-2030. This it estimates will account for around EUR 10 billion in sales revenue.

Stefan Hartung, Chairman, Bosch Board of Management, said, “The breakthroughs in AI make it possible to open up completely new chapters in technology, accelerate the development of innovations, and turn these into business.”

In the automotive industry, Bosch has developed expertise in automated driving, for example for visualising the vehicle’s surroundings and route planning. Thanks to AI, the vehicle thinks ahead, anticipates how other road users will behave, and calculates the next steps to get to its destination safely. AI not only ensures greater safety in vehicles, however; it also helps significantly shorten development times for new products. For example, Bosch can draw on a unique database of vehicle sensor data to feed a generative AI solution – and thus train systems much faster and more efficiently. This could pave the way for even more reliable driving assistants and automated driving functions in the future.

The company also expects AI for making manufacturing more streamlined and smart, not only for Bosch factories, but also for its clienteles.

Furthermore, the German technology major is also getting its associates on board. The company through its in-house AI Academy has trained over 65,000 associates since 2019. Nearly 5,000 AI specialists are working on intelligent AI solutions.

“One thing is becoming increasingly clear: a society without AI capabilities will fall behind in global competition,” said Hartung.

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