When COVID-19 hit the market in the first half of 2020, headlines all over the world surfaced that vehicle demand decreased drastically. But, within a year, there is another concern based on the supply side. Although the demand suddenly escalated globally, a massive slump of automotive semiconductor production had forced the OEMs to halt the manufacturing units. According to an exclusive report of McKinsey & Company, since May 2021, the situation has worsened and the recent drop in automotive revenues is largely occurring because OEMs and Tier 1 suppliers cannot procure sufficient quantities of chips and must delay vehicle production. Interestingly, the demand for vehicles was huge, but manufacturing units have stopped production. In the past few months, various global experts have added that the situation has eased a lot, but it will take another 1-2 years for a complete normalization. In this regard, we spoke to Guruprasad Mudlapur, President of Bosch Group India about the current challenges in the semiconductor and automotive sector and how Bosch is playing an imperative role to tackle those challenges and elevating the growth in India. Guruprasad has been recently awarded ELCINA’s special jury award, “Electronics Man of The Year.”
Q. The automotive and the global semiconductor industry went through a lot of challenges over the past few years like supply chain imbalances, production slump, workforce shortage etc. Can you paint the current picture of the industry and is there any additional challenge currently?
The semiconductor industry has been through a lot of ups and downs over the past few years, mostly due to COVID-19. Prior to the pandemic, the chip demands were already increased by two-folds among the automobile and in the consumer electronics segment. Products have become smart now and without semiconductors hardly any industrial sectors can survive. But, it has now recovered quite well and in the automobile sector hardly there are any bottlenecks now. There can still be some issues in the supply chain ecosystem, but by and large the crisis in the automobile segment is almost over. There is also a requirement for significant capacity enhancement in the semiconductor sector. It’s an ongoing process and in the coming few years, it will be successfully done.
Q. As an expert in the industry, do you feel the semiconductor production shortage has normalized or will it take more 2-3 years to become like the pre-pandemic scenario?
I think the semiconductor production shortage situation by and large has already eased a lot and we don’t have any such major semiconductor issues anymore affecting the supply chain of the auto electronics anymore. There could be some areas where there could be specific shortages, but that we will have to deal with proper strategies. But, by and large the situation has been normalized to pre pandemic level.
Q. How Bosch is spearheading the innovation in the industry and how your helping the automotive industry with your latest technologies and solutions?
Bosch is a major global technology company and we offer not just automotive electronics, but also consumer electronics. But, the latter we offer in the form of home appliances. We are basically a semiconductor company and we have been developing and manufacturing them for more than sixty years for both automotive applications and for the consumer electronics market. In fact, if you look at our global website, it clearly says we are systematically expanding our manufacturing capacity for semiconductors in Reutlingen. This new investment will not only strengthen our competitive position, but will also benefit our customers and help combat the crisis in the semiconductor supply chain globally. We offer a full range of advanced products in the market backed by the latest technologies.
Q. In the semiconductor and automotive industry you do have fierce competition in the market. So, what is the biggest differentiating aspect of Bosch that helps you stay ahead of the competition curve?
We are the largest auto tier-1 company and the scale is very big. We do have a huge manufacturing set-up as well and of course we are technology leaders in the market in the auto electronics and offer a complete range of auto components. So, that really distinguishes us from being able to conceptualize, design technologies, manufacture products with latest technologies, test it properly and then we deliver it to the market. Last year, Bosch group celebrated 100 years of journey in India and we are a very old company and we do invest billions in research and in manufacturing. We have recently invested a lot in our development capabilities and we now have the largest development center in India apart from Germany. For the Indian market, we do most of the manufacturing in-house.
Q. You have been awarded “Electronics Man of The Year” by ELCINA. How has it boosted your confidence and why do you feel the accolade is important?
I am absolutely honored and humbled by this award. It’s a great recognition coming from an institution, which is more than fifty years old and they have done tremendous work over the years to boost the growth of the Indian semiconductor and electronics industry. I am actually very honored they have recognized my work and selected me for this prestigious accolade. It's really a humbling experience for me. I am very hopeful that ELCINA will carry out this initiative in the future as well so that domestic entrepreneurs can gain more confidence to grow this industry.