Smart tech, self-driving and safety features to dominate auto industry by 2030: Niti Aayog report

The automobile industry is heading for a major transformation by 2030, driven by growing demand for safety features, electric vehicles, and smart technologies, according to a recent report by NITI Aayog.

One of the key highlights of the report is the sharp rise in the adoption of Advanced Driver-Assistance Systems (ADAS). The report highlighted that these features, which help drivers stay safer on the road, were present in 42 per cent of new vehicles sold in 2020. However, their presence is expected to grow rapidly and touch 90 per cent of new vehicle sales by 2030.

It said, "Advanced Driver-Assistance Systems (ADAS) are projected to rise from 42% of new vehicle sales in 2020 to 90% by 2030, spurred by consumer demand for safety features and regulatory requirements."

Another major trend mentioned by the report is the rise of autonomous or self-driving technologies. In 2020, less than 1 per cent of vehicles had such features, but the report projects that more than 30 per cent of vehicles could be equipped with some level of autonomous driving capability by 2030.

This will raise the demand for high-tech components like sensors, artificial intelligence (AI), and powerful computing systems.

Software is also set to play a much bigger role in vehicles. At present, software accounts for around 2 per cent of a car's total value. This share is expected to double and reach 4-5 per cent by 2030.

As vehicles become more connected and capable of receiving updates over-the-air, the market for automotive software is projected to grow to USD 80 billion.

The report also highlighted how electric vehicles (EVs) are changing the structure of vehicle manufacturing. EV-specific parts--such as electric motors, lithium-ion batteries, and advanced electronics--are expected to make up nearly half of the value of an electric car.
This means that manufacturers must focus on innovation and scaling up production to stay competitive.

NITI Aayog said, "The automobile industry stands to gain significantly from the shift to electric cars (EVs), since EV-specific parts are predicted to account for about half of the vehicle's overall value."

It stressed that collaboration with technology firms will be crucial in shaping the future of mobility. Automakers that quickly adapt to these changes--by embracing software, automation, and electrification--will be best positioned to thrive in the next phase of the automotive revolution.