Innovation Driven Automobile Industry


The Indian auto and affiliated industries have seen unprecedented progress and growth in the last ten years.  India has gone from an economy which used to replicate innovation and products from industrialized nations to becoming one of the preferred destinations for research and development, as well as manufacturing.  To compete globally however, it is essential for organizations to invest in, develop and capitalize on their intellectual property (IP).  But how to go about this is something that most Indian companies are only now coming to grips with.


On a global scale, auto majors have stepped up their total R&D spend.  There is a noticed increase in innovation in areas such as propulsion, navigation, handling, safety and security, and infotainment. In the last five years, the list of companies who spend the most on R&D has remained unchanged.  Volkswagen, Toyota and General Motors have consistently out spent their competitors such as Daimler, Honda and Ford.   During this time we have also seen Volkswagen take on Toyota for the top auto sales position in the world.


Increased investments in R&D have led to an increase in the number and quality of innovations in the vehicles that we drive.  This is affirmed by the ever increasing number of patents filed by auto majors.  Toyota once again leads in the number of filings, in the last five years, followed by Bosch, Hyundai, Honda and Denso.   The consumers’ evolving preference for connected cars and frugal or green vehicles has also brought about upstart companies with cutting edge solutions.  The door also has been opened for non-automotive majors such as Google and Apple to provide software and management systems.


At this time, Indian auto majors are not being spoken of as global innovators or even being IP savvy.  However, that does not mean the dynamics aren’t changing.  Mahindra & Mahindra, Tata Motors, Hero, Bajaj and TVS are some of the Indian majors revamping their focus on R&D and driving up their global competitiveness.  With an abundance of scientific and technical human resources, India is the preferred destination for non-Indian companies as well.  Daimler and Ford have recently set up their captive R&D units in India.  The times are changing for the auto sector, innovation being the key, IP being the means.


Contributed by Sanjeeth Hegde, Partner – BananaIP.