Build Resilience. Let the Auto Industry Lead the Way - Letter from the Editor

Take Google's Waymo robotaxi, for instance. Undoubtedly, a piece of mind-bending tech, but if its fleet wasn't already 3,000 strong (with the potential to soon grow many times over), it wouldn’t have made half the impact. The point being that this innovation would be far less meaningful if it weren't backed up by the industrial capacity to not just build the donor vehicle at scale but also all the components – LIDAR, radar and cameras – that enable it to be completely driverless.

The use of scientific knowledge, engineering, and systems to create tools, processes, or services that improve human capability – that's the textbook definition of technology. The invention of fire, the wheel, the printing press and the steam engine are just some examples through the ages that broadly fit this description.

But it was the furnace that took the invention of fire and scaled it to produce iron, which gave shape to the industrial revolution, resulting in the steam engine that put the wheel to work, reinventing how goods and people moved across vast distances. But well before that, the printing press transformed how knowledge was preserved, spread and made accessible at a scale never before imagined.

So, for real transformation, invention and industrial capacity go hand in hand. So, why then are automakers today shunning their manufacturing legacy in favour of being perceived as "tech companies"? After all, if it weren’t for Henry Ford, there would be no assembly line. And if it wasn't for Toyota, there would be no Just-in-Time inventory, lean manufacturing or quality control at scale.

I suppose all you really have to do to get the answer to that question is look at the top-ten largest companies in the world by market cap, of which Tesla is number ten, at about $1.5 trillion (about six times larger than Toyota). Of the remaining nine, eight are tech companies, with the sole exception being Saudi Aramco.

If creating shareholder value is the primary objective of any organisation, then it’s pretty clear why every automaker in the world is positioning itself as a tech leader rather than a traditional manufacturer. But, if the war in West Asia has taught the world anything over the past few weeks, it's that you can’t afford to farm out industrial capacity. Self-sufficiency is key. That being the case, the ability of the automotive industry to manufacture some of the most advanced devices in the world is something to be celebrated – not shied away from.

In India, we need to focus on building resilience, creating industrial capacity and ensuring self-sufficiency across industries to minimise the future impact of external shocks. We would do well to look to the automotive industry and its ecosystem as an example of how to do just that.