‘Severe supply shortage’ of imported Bosch semiconductors could impact India Auto Inc

Even as the call for Atmanirbharta or self-reliance in the Indian automotive industry grows louder by the day, there has been an announcement by leading Bangalore-based components and technology provider Bosch Ltd that the supply of imported micro-processors (semiconductors) to the Indian market could slow down.

In a regulatory filing issued on December 8, Bosch Ltd said: “The automotive sector was going through a downturn in FY20 due to structural changes and this was further impacted with stringent lockdowns due to COVID-19 pandemic. In the Second Quarter of FY21, the automotive industry showed signs of recovery but remained impacted due to volatile forecasts and disruptions in global supply chain & planning."

"In parallel, the demand in the consumer electronics industry has seen steep escalations driven by safety and hygiene sentiments as well as the rise of 5G connectivity. This led to a surge in global demand of semiconductors, a critical component in manufacturing of automotive electronics. As an outcome, imports of Bosch Ltd has been impacted with severe supply shortage for Imported micro-processors (semiconductors), leading to reduced ability to deliver to the automotive market demand in India. Restoration of normalcy in global supply situation for imported components and impacts are being very closely assessed and addressed on top priority.”

ACMA pushes for Atmanirbharta
Speaking about the development, Deepak Jain, president, ACMA, mentioned that, “ACMA is keenly watching the situation as it unfolds. It is still not clear as to what extent and for how long the shortage of semiconductors will impact vehicle production in India. Any stoppage of vehicle lines has a resonating effect on the entire automotive component manufacturing ecosystem. We are continuing to engage with the OEMs and monitoring the situation.”

“The electronic content in vehicles has been progressively increasing and incidents such as these only precipitate the need for localisation and self-reliance in automotive electronics in the country,” added Jain.

Macro role of microprocessors
Semiconductors form an integral part of a modern-day automobile ranging from passenger cars to buses and even two-wheelers. From driving basic things like digital radio tuners, electronic power steering, and door-and-mirror controls to complex mechanisms such as LED lighting, telematics and V2X communication for ADAS functionalities, these microprocessors are at the core of the vehicle, increasingly transforming it into an electronic-intensive piece of engineering. As vehicles transform into computers on wheels, it is microprocessors and semiconductors that are essaying the key role in the transition.

Furthermore, with the growing adoption of electric mobility, these semiconductors are further going to enhance their contribution and become deeply integrated in the neural networks of a vehicle to drive a predominant set of functionalities of what are seemingly the vehicles of the future.