As vehicles evolve into intelligent, high-tech machines on wheels, car tech surge to double chip costs by 2030 — EVs, AI, and smart systems drive demand. NITI Aayog says.
The cost of semiconductor chips used in vehicles is expected to rise sharply by 2030, doubling from the current average of US$600 to US$1200 per vehicle. This projection comes from a recent report by NITI Aayog, highlighting the growing integration of advanced technology in the automotive sector.
The increase is mainly due to the shift towards electric vehicles (EVs) and the adoption of sophisticated systems such as advanced driver assistance systems (ADAS), autonomous driving features, and Internet of Things (IoT) connectivity. These technologies require more complex and powerful semiconductor components.
According to the report, the global automotive industry is in the midst of a major transformation. Traditional internal combustion engine vehicles are steadily being replaced by EVs, which rely heavily on electronics and intelligent systems. This trend is boosting the demand for semiconductors.
The report also notes that the role of electronics in vehicles is expanding rapidly. As a result, the automotive sector is becoming more closely linked with industries such as semiconductors, artificial intelligence, and IT.
The global automotive component market was valued at around USD 2 trillion in 2022, with nearly US$700 billion from traded parts. The sector has grown at a rate of four to six per cent annually over the past five years, driven by increased demand for smarter and more sustainable vehicles.
The continued rise of EVs and smart mobility solutions is expected to fuel further innovation, deepening collaboration between automotive manufacturers and the technology industry.
