Can India tap a $250 billion electronics opportunity?

One of the key challenges for the development of auto electronics in India is the lack of availability of skills, said Subu D Subramanian, MD of Hinduja Tech, in his opening remarks at the CII Conference on Innovation for Automotive Electronics held in Chennai.

The one-day event was attended by over 150 delegates who gathered to listen to a variety of speakers from across the sector including Renault-Nissan Business Centre, the Mahindra Research Valley, Microsoft India and other companies.

Automotive electronics is one of the emerging areas for the Indian industry; the reasons are not difficult to fathom. Major areas will include safety, communication and powertrain, speakers said, and India is among the biggest markets.

 As electronic content in the vehicle increases, OEMs realise that these features can potentially be a game-changer for the auto sector. It is estimated that the global electronics in the auto sector account of close to $160 billion (Rs 980,800 crore). The industry is expected to be worth $250 billion (Rs 1,532,500 crore) by 2020.

S N Eisenhower, vice- president of CII Tamil Nadu, set the tone for the conference saying that technology is an important growth strategy and auto electronics can be a growth area if companies respond to consumer needs as well as requirements of safety. More importantly, he said that by 2020, import of electronic items will exceed that of oil if the domestic eco-system is not developed.  

Subramanian added that individual preferences will be increasingly important. He added that in R&D budgets, electronics is on top of the agenda. In addition, he emphasised the fact that increasingly, web devices will be linked to the vehicle enabling functions like handling repairs and breakdowns to take place seamlessly. Chennai, Pune and Bangalore are a strategic triangle, he added to tap the potential of the auto electronics segment.

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In his keynote address, Aravind Bharadwaj, head – technology TPDS, AFS, Mahindra & Mahindra, said that telematics, car audio and in-car entertainment are the areas for India to take leadership. The challenges, he said, are for India are to build scale, leverage skills across the industry and establish viable partnerships.

Reiterating what an earlier speaker said, Bharadwaj said India needs to have the right skillsets and not just in the mechanical engineering area but mechatronics as well as what is called 'The Internet of Things’ or IoT.  M&M, he said, is working with Tech Mahindra to take advantage of the opportunities in the auto electronics space. He said India could offer new models around aspects such as parking management, zero-emission taxis and demand response.  

Biju Balendran, vice-president, plant engineering and vehicle process engineering, Renault Nissan Automotive India,  spoke about the need to distinguish between innovation and invention while stressing the facts on safety and manufacturing as far as auto electronics is concerned. The importance of driver assist systems was an area that he highlighted. 

Arun Kumar Sampat, GM - monocoque platforms, M&M, spoke about reverse engineering in auto electronics and how to align the challenges of the sector with the Centre’s made-in-India initiative. He highlighted the need to have price-performance points in the products that are being made and targeted at the auto sector.

 In his final remarks, Subramanian said while there are options in auto electronics for upcoming models, there are opportunities in existing vehicles that can be tapped. Other issues that came up included the fact that with greater electronic content, industry would have to consider what to do with the waste generated in the form of PCBs, among other things.

In this context, one issue that was highlighted was.that work that has begun on the Automotive Mission Plan 2026 and India needs to have an end-of-life vehicle (ELV) policy.

On the skillsets front, the issues that were broached included India’s bookish nature of teaching. Students, speakers stressed the need to have a hands-on experience in the field if they are to succeed in making innovative  products.

And referring to IoT, one speaker said actually it is an extension of data. He cautioned that in a changing industry, things can tend to get repackaged for new markets and so, the need is to familiarise those involved in the industry.

Overall, the need is for the Indian auto segment to establish a vibrant eco-system that will promote healthy growth of auto electronics. In addition, an integrated setup between academia and industry will only help the process but here is where India lags the efforts of other developed auto markets. In this context, Indian players will have to learn to adapt and learn continuously.  

In his reaction to the conference, Kalaiichelvan Mananathan, managing director, Manatec Electronics, said, “We are an R&D company and design projects that help the auto industry. This conference presented a variety of views about the upcoming, futuristic design opportunities, automotive electronic particularly. As an automotive electronic R&D company, there are lots of takeaways from this conference which I can go back and reflect upon."

 Another participant, who didn’t wish to be named, said, "Some of the sessions were really informative, especially from the Indian industry point of view. The conference presented both technical and industry standpoints.”

Yet another reaction to the proceedings of the day was the need to talk about software, open sourcing and its implications for safety. As the internet gets ever more linked to the automobile, there are certainly implications for new products. As it happens at all events, the topic of autonomous cars came up. The autonomous car is a mission in the developed markets of the west, speakers said and that cars are taking away the pain of driving for western car buyers who see the time saved by not driving as a chance to do something else.

Alluding to the Made-in-India plan, other opportunities include use of digital marketing which is on the rise. Also, the fact that by 2017, India will be one of the largest markets for smartphones is an opportunity that can be tapped. So it is the area of software development that India has opportunities that it can tap.  Hinduja Tech is working on with an app which will help manufacturing companies with better practices. It will be a combination of software, hardware, embedded technologies and other things and will be introduced in a few months from now.

With its young, tech-friendly population, India’s demographic dividend provides a great opportunity to ascertain demands from OEMs in the auto electronics sphere. The sheer variety of demands will itself provide a challenge for those in auto electronics to tap, even as new markets in other geographies and in the developed world will continue to beckon.

Photograph above (L-R): S N Eisenhower, vice-president, Confederation of Indian Industry, Tamil Nadu and director (operations), Saint-Gobain Glass India; M Velmurugan, executive vice-president, TN Guidance Bureau, Industries department, Tamil Nadu; Subu D Subramanian, MD and CEO, Hinduja Tech; Aravind Bharadwaj, head (technology), AFS, Mahindra & Mahindra, and S Saha of the CII at the event held in Chennai on October 17.