Embitel Technologies: Driving the future of automotive innovation with AI and electrification

Founded in 2006, Bengaluru-based Embitel Technologies has evolved from an Indian automotive software start-up into an important engineering and technology partner within the Volkswagen Group. Its journey reflects the changing nature of the automotive industry, where software, artificial intelligence (AI), connectivity, and electrification increasingly determine how vehicles are designed, developed, and operated. The company specialises in automotive embedded systems, software-defined vehicles, connected mobility, EV technologies and AI-led engineering.

Sharad Bairathi founded Embitel with the conviction that software would eventually become central to the automotive industry. Initially, however, penetrating the sector was difficult because the traditional internal combustion engine ecosystem was well established and automotive manufacturing was largely vertically integrated. The emergence of electric vehicles (EVs) subsequently opened new opportunities, allowing Embitel to leverage its expertise in infotainment, telematics and electronic control systems.

Unlike conventional IT services companies, Embitel followed a product-led engineering model, developing solutions from concept to production. It built proprietary intellectual property (IP) and engineering accelerators that could be integrated into customer projects, reducing development time and helping deliver production-ready solutions. This approach eventually attracted Volkswagen, which invested strategically in the company in 2019 before acquiring full ownership in 2022. 

The Volkswagen association has given Embitel access to a much larger automotive ecosystem while allowing it to retain its entrepreneurial culture and operational independence. Today, it operates as a GCC+ (Global Capability Centre Plus) organisation, functioning as a profit centre rather than a conventional captive cost centre. Importantly, nearly 30 per cent of its revenue continues to come from customers outside the Volkswagen Group, including global automotive OEMs and Tier I suppliers.

Differentiation factor

“We are a tech company; at the same time, we are part of an OEM too,” says Bairathi, MD, Embitel. “This is a great differentiation factor because, with our deep engineering expertise, we are well positioned to build global software.” Access to the group’s automotive platforms and data gives Embitel an advantage in developing and validating sophisticated vehicle technologies, he adds.

The company’s capabilities span advanced driver assistance systems (ADAS), EV energy and charging systems, vehicle platforms, cyber-security, functional safety, infotainment and cloud-based connectivity. Its ADAS division is particularly significant, employing about 450 engineers working on technologies that support the transition towards software-defined vehicles (SDVs), including advanced L2++ and L3 autonomous driving systems. Another 300 engineers work on vehicle platforms, while 300 focus on energy and charging technologies.

With AI emerging as an important growth driver, Embitel is working on AI-enabled vehicle intelligence, autonomous driving capabilities and intelligent software architectures. It is also investing in AI-based engineering tools and safety systems. Bairathi believes AI will complement rather than displace automotive engineering expertise. “AI is helping us more, rather than the other side that people are talking about,” he says, pointing to the importance of proprietary automotive data, simulation and rigorous validation in developing safe vehicle technologies.

Beyond developing vehicle systems, Embitel also supports their validation through simulation, hardware-in-the-loop testing and scenario-based assessments. These processes help identify potential safety and performance issues before technologies are deployed on the road. The company’s work also covers over-the-air software updates and cyber-security, areas gaining importance as vehicles become more connected and dependent on continuous software improvements throughout the vehicle lifecycle.

Embitel employs about 2,000 people, primarily in Bengaluru, with a smaller presence in Pune. The company has been growing at 30-40 per cent annually over the past three to four years. With revenue at about €70 million, it is targeting €100 million next year and has set its sights on €200–250 million by 2030. It also plans to expand its workforce to around 4,000 by the end of the decade.

As automotive manufacturers increasingly assume greater ownership of software development, Embitel sees opportunities in end-to-end engineering, autonomous driving, cybersecurity and connected mobility. Its ability to combine product engineering with the domain knowledge of a global automobile manufacturer could prove an important differentiator as the industry moves towards software-defined and AI-enabled vehicles.