India to shift to 'smartphone era' for cars embracing 5G, AI: Report

India is set to enter a transformative "smartphone era" for cars in 2025, with the introduction of vehicles featuring 5G M2M connectivity and advanced AI technologies, according to the latest findings from Techarc's India Connected Consumer Report 2025.

The report said the automotive sector will skip 4G and will enable connectivity using the latest 5G cellular technology.

It observed that consumers are interested in spending money on improving the value proposition in terms of features, quality and experience rather than exploring too many smart devices.

"22 per cent of the respondents shared about considering optimising their smart devices portfolio. Among the new set of categories, smart/connected cars is generating high interest among consumers. 55 per cent of the respondents said that they have come across news or information about smart/connected cars in recent times," it said.

Starting in 2025, passenger cars in India will be equipped with 5G M2M connectivity, on-device GenAI, and cloud connectivity, making advanced technologies accessible across various price segments, it added.

In-vehicle computing and artificial intelligence (GenAI), along with cloud applications, will become essential components of cars, enabling real-time data processing to support drivers effectively.

Most cars priced at Rs 20 lakh and above will feature these technologies as standard. The cumulative revenues from automotive chipset companies have already surpassed USD 1.5 billion, with companies like Qualcomm and MediaTek leading the market.

Some of the familiar applications that consumers will be able to use while driving include communication apps for audio/video conferencing, OTT entertainment apps, music streaming, podcasts, online shopping, vehicle maintenance, and servicing.

"With connectivity and the technologies it brings to the cars, the future of the automobile sector will be fundamentally determined by the auto-technologies that will influence the overall experience, performance, comfort, safety and entertainment available to the drivers as well as the passengers.

"So far, such features were seen as luxury or high-end experiences. But starting 2025, many of these will become mainstream for cars in India," Techarc AutoTech Analyst Sadat Ahanger said.

With 22 automobile manufacturers producing nearly 5 million passenger vehicles annually in India, the country is poised to become a leader in the global 5G M2M market within the next few years, the report said.

About 21 per cent of respondents said MG Motors is the leader in providing connected cars in India, followed closely by Kia Motors at 18 per cent and Tata Motors at 15 per cent, it added.

Hyundai and Maruti Suzuki also ranked among the top-five brands in this category.

The report draws insights from a survey of 4,500 "connected consumers" across metro and non-metro cities. The report defined a connected consumer as one owning at least 3 smart devices in addition to a smartphone.