TE Connectivity in a study on “Electronics Manufacturing in India, in Pursuit of Greater Localisation” found out that the Indian automobile industry has experienced significant growth in the last decade. The automobile industry was valued at US$92.12 billion in FY 2011-12, and is estimated to grow to around US$130 billion by FY 2020-21.
A similar rise can be expected in the share of electronics in automobiles which is estimated to hike from the present US$9 billion to US$26 billion by 2020.
It is broadly estimated that the average share of electronics in an Indian car today is in the range of US$1000 to US$1500 per car. Electronic components used in the automotive industry are estimated at 10 percent of the total bill of materials, and this is expected to increase by about 10 percent over the next ten years.
The report also states the challenges faced by the automobile industry in India. Dosmestic policies and dynamics of crude oil prices have adversely affected the demand of automobiles in the last two years. This has led to reduced exports and domestic demand since thus widening the supply-demand gap in automotive electronics.
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