Chipset Rivals – Automotive sector

Chipset rivals Qualcomm and MediaTek are extending their rivalry beyond smartphones into India’s automotive sector, gearing up with fresh investments to attract customers in the four- and two-wheeler segments with their latest offerings.

While Qualcomm has worked with Indian automotive companies for some time, Taiwanese rival MediaTek will soon sign up its first customer as the sector prepares to embrace the EV revolution.

“We are making major investments, especially in India. We are working with all 4W and 2W OEMs (original equipment manufacturers). We aim to work with the OEMs and help them bring new automotive experiences using Snapdragon digital chassis systems,” Savi Soin, president of Qualcomm India, told Moneycontrol.

Qualcomm, based in San Diego, California, recently announced partnerships with Tata Motors, Mahindra & Mahindra and TVS to accelerate digitisation in the auto sector.

“Our partners have integrated with not one but multiple Qualcomm platforms and solutions into their vehicles. As we collaborate closely with Indian automotive OEMs, we are well-positioned to address their evolving needs and remain committed to introducing smart, connected and secure technologies by leveraging our mobile expertise,” Soin added.

‘Big revenue’

MediaTek, a new entity in the automotive industry, is equally bullish and expects the segment to become a major source of revenue in the country. It will soon announce its first partnership in India with a two-wheeler EV company even as it is in advanced discussions with four-wheeler companies, Anku Jain, managing director of MediaTek India, told Moneycontrol.

“This is a big upcoming market in the next two years, and we feel that automotive is going through a change. We are already talking to customers in India, including EV players. We have got good traction and feel this would be a big revenue source for MediaTek,” Jain said.

Last year, the Taiwanese fabless chipmaker revealed plans for this market with the launch of the computing platform Dimensity Auto. It aims to become a one-stop solution provider for major automotive electronic components from computers to connectivity, targeting digital cockpit, infotainment and telematics units.

Analysts said Qualcomm and MediaTek are strategically pivoting towards providing advanced solutions for connected and autonomous vehicles as India embraces the electric vehicle revolution. They compete with NXP in the digital cockpit and autonomous driving segments.

Faisal Kawoosa, an analyst at TechArc, said sectors like smartphones and other smart devices are witnessing a plateaued opportunity; hence, for players like Qualcomm and MediaTek, automotive is the emerging opportunity to drive growth.

According to Counterpoint Technology Market Research, embedded connectivity is expected to be integrated into over 80 percent of passenger cars, while more than 70 percent of these vehicles are projected to incorporate autonomy features by 2030.

Embedded connectivity refers to internet-ready cars that come with a built-in chipset and antenna. The embedded system allows the car to download updates, send data and connect with other devices and networks on its own.

“India is gradually aligning with global OEMs in providing cutting-edge features, with premium functionalities extending to mid- to lower-end cars. These chipset giants are poised to play a crucial role in enabling cutting-edge features across all vehicle segments, from premium to entry-level models,” said Soumen Mandal, a senior research analyst at Counterpoint Research.

Kawoosa said that automobiles of diverse types integrate 15-25 consumer-facing technologies spanning comfort, safety, entertainment, and communication. “With the growing need for vehicle processors to support these functionalities, companies like Qualcomm and MediaTek are capitalizing on the opportunity.”

Local R&D support

Qualcomm and MediaTek are leveraging their local research and development units to support requirements in the automotive segment. Jain said MediaTek has global R&D centres in Noida and Bengaluru that design chips for the automotive sector.

Soin said Qualcomm’s huge engineering presence in India is working on automotive technologies and use-cases to support auto OEMs and tier-1 customers globally and in India.

“Looking at the increased adoption of technology by Indian OEMs and consumers, India is well-positioned to become the key growth driver for chipmakers including Qualcomm. The auto sector’s future in India can surely be even better than the global markets,” he said.

However, Mandal highlighted that Qualcomm and MediaTek may face challenges in a market where OEMs and traditional car manufacturers are also investing in developing proprietary solutions for software-defined vehicles.