New Delhi: According to a recent analysis by NITI Aayog, the average cost of semiconductor chips used in automobiles is predicted to quadruple by 2030, from USD 600 to USD 1,200 per car. The rise is ascribed to the expanding use of cutting-edge automotive technology, such as electric drivetrains and intelligent driving capabilities.

According to the research, the global automotive industry is changing dramatically as it moves away from conventional fuel-powered cars and toward electric vehicles (EVs).

Next-generation technologies, including Internet of Things (IoT) connection, Advanced Driver Assistance Systems (ADAS), and Autonomous Driving (AD) capabilities, are progressively being added to these EVs.

More complex semiconductor chips are needed for these high-end functions, which raises demand and costs.

According to NITI Aayog, “With the integration of these cutting-edge technologies, the cost of semiconductor chips per vehicle is projected to double, rising from USD 600 to USD 1,200 by 2030.”

Electronics and semiconductors are playing an increasingly important role in the automobile sector as vehicles become more sophisticated and networked. According to the survey, the incorporation of cutting-edge technology is altering not just the cars themselves but also the industrial environment globally.

Artificial intelligence (AI), semiconductors, electronics, and the automobile industry are all becoming more and more intertwined.

Furthermore, the automobile industry is one of the biggest users of a variety of industrial goods globally due to its close ties to other important industrial sectors, including steel, textiles, leather, rubber, plastics, glass, and IT.

The study states that the worldwide market for automotive components was estimated to be worth USD 2 trillion in 2022, demonstrating its vital significance in the larger automotive ecosystem. Approximately USD 700 billion, or about 30%, of this is derived from traded vehicle parts.

Rising consumer demand and increased interest in car ownership have propelled the automotive sector’s steady expansion over the last five years, at a pace of 4 to 6%. It is anticipated that the growing emphasis on smart, high-tech, and environmentally friendly automobiles will continue to further this development trajectory.

A new age of innovation and cooperation between the automotive and technology industries is anticipated as a result of the growing need for semiconductor chips and sophisticated components brought about by EVs and smart mobility solutions.