R&D Activities and Joint Ventures Become Crucial Strategies to Strengthen Automotive Electronics Capabilities

17 Mar


Electric vehicle (EV) is a sensation of the future of the automotive industry. Automotive players have redesigned their business models and been taking steps to maximize their automotive electronics capabilities. The focus has been shifted to research and development activities and innovation. By adopting solution-oriented approach, companies have been innovating. In addition, joint venture is another strategy adopted by market players to combine capabilities of each other to develop new solutions and scale up production of EV-focused components. The investments and resources have been shifted toward automotive electronics division. The demand for electronics in the automotive  industry would gain momentum in the next few years. According to the report published by Allied Market Research, the global automotive electronics market is expected to generate $382.16 billion by 2026. Following are some of the activities taking place across the world. 

Research and development activities have been taking place across the world as the part played by electronics in automotive is becoming crucial. The leading Indian car manufacturer Tata Motors filed 80 patents and gained approval for total of 98 patents in 2020. With the trend of CESS (connected, electrified, sustainable, and safe) taking place across the automotive industry worldwide, auto manufacturers have been trying to improve automotive electronics systems. 

Commenting on the company’s commitment and focus on R&D, Rajendra Petkar, the Chief Technology Officer at Tata Motors, highlighted that the company has a rich history of bringing innovations that have become the benchmarks for the industry. It pushes its team to challenge the status quo and think afresh in pursuit of excellence.  With the solution-oriented approach, the company ideates, innovates, and collaborates to develop new technologies and products for customers. 

Determining the need for electric vehicles for the sustainable future, market players have been taking necessary steps. One of the crucial steps includes strengthening capabilities of automotive electronics through joint venture. LG Electronics has taken several steps in preparation of next generation EVs. The company entered a joint venture agreement with Magna International for establishing e-powertrain. Both companies would collaborate to develop motors and inverters for EVs. Through combination of engineering capabilities of Magna and its own EV powertrain component technologies, the company aims to strengthen its capabilities. 

The joint venture is expected to set up a mass production system and scale up its operation at an early stage. The company would receive orders from Magna as well as its customers. With an objective to consolidate its automotive electronics business, LG Electronics entered a joint venture agreement for its vehicle lamp business with an Austrian vehicle premium headlamp company ZKW in 2019. In addition, the
company established VS Business Division for development of infotainment system. 

Realizing the importance of electronics in next-generation of vehicles, companies have been allocating maximum resources and investments. Lumax Auto Technologies decided to optimize resources and allocate maximum investments to the electronics division. In addition, the company has been establishing an infrastructure to optimize localization abilities. It would focus on producing EV specific components such as controllers, motors, on-board chargers, and others. 

Alex Hillsberg

Alex Hillsberg

Chief editor of review team at FinancesOnline

Chief editor of review team at FinancesOnline Alex Hillsberg is an expert in the area of B2B and SaaS related products. He has worked for several B2B startups in the past and gathered a lot of first hand knowledge about the industry during that time.


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