The domestic manufacturing of automobile components holds paramount importance for India's economic growth and development. The Indian government's proactive stance on promoting domestic manufacturing through incentives, coupled with supply constraints in China, has created a favourable environment for the country's automotive component manufacturers.
The indigenous automakers such as Maruti, Tata, and Mahindra command a substantial 65 per cent share of the market, underscoring the ongoing success of the domestic automotive industry. As per the report by the India Brand Equity Foundation (IBEF), during the fiscal year 2023, passenger vehicle sales reached a total of 3.89 million units. In the same period, India's automobile exports amounted to 47,61,487 units. Over the years, the sector's contribution to the national GDP has witnessed a substantial rise, climbing from 2.77 per cent in 1992-1993 to approximately 7.1 per cent at present. This industry plays a significant role in employment, directly and indirectly engaging around 19 million people.
Artificial intelligence (AI) has also played a pivotal role in shaping the modern automotive landscape. AI is revolutionising various aspects of the industry, from design and manufacturing to safety and customer experience.
The automotive industry in India is leveraging AI technology to enhance efficiency and competitiveness. AI is being employed in product design, utilising algorithms to optimise vehicle aerodynamics, safety features, and fuel efficiency. Manufacturing processes are benefiting from AI-driven automation, leading to increased precision and reduced production times.
From industrial robots utilised in production facilities to the development of self-driving vehicles, AI has ushered in transformative changes within the automotive industry. Consequently, major players such as Mercedes-Benz, Toyota, Volkswagen, Tesla, Volvo, Bosch, and numerous others are actively embracing AI technology as part of their strategic initiatives to enhance the overall customer experience.
Although the utilisation of AI is currently in its initial phases within the Indian automotive sector, it is inevitable that its widespread adoption is on the horizon. Self-driving AI cars in India are beginning to manifest in various ways, with several notable examples showcasing the industry's progress. Companies like Tata Motors and Mahindra & Mahindra are actively exploring autonomous vehicle technology, conducting research and development to bring self-driving capabilities to their vehicles.
Electric Vehicles Outlook in 2024
The year 2024 is poised to be a pivotal year for electric vehicles in India. The availability of a diverse range of electric models, improvements in battery technology, and an expanding charging infrastructure are expected to contribute to a surge in EV sales. Government incentives and policies promoting clean energy vehicles further bolster the outlook for electric mobility.
Challenges such as range anxiety and the need for a more robust charging infrastructure are being addressed through innovative solutions. Collaborations between automotive companies and technology providers are resulting in breakthroughs that promise to make electric vehicles more accessible and convenient for the average consumer.
It can be confidently stated that the growth of the automotive sector in India in 2023 is marked by technological advancements and a shift towards sustainable practices. AI is poised to revolutionise the Indian automotive industry by not only enhancing safety, manufacturing efficiency, and customer experience but also by fostering the development of connected sustainable, and intelligent transportation systems. The integration of AI technologies is steering the industry towards a future characterised by innovation, efficiency, and a heightened focus on environmental responsibility.
The author is Director General, SMEV