Elec­tron­ics ex­pe­dites auto tech evo­lu­tion

Auto components India - - COVER STORY - Story by: Bhar­gav TS

The pace of ve­hi­cle tech­nol­ogy evo­lu­tion is ac­cel­er­at­ing aided by elec­tron­ics and soft­ware. Ve­hi­cles are chang­ing in re­sponse to con­sumer taste and ex­pec­ta­tions, higher safety stan­dards, and the drive to­ward a low-car­bon fu­ture. When con­sid­er­ing changes in au­to­mo­tive tech­nol­ogy that sup­port the “green­ing” of trans­porta­tion, most peo­ple think first about ad­vanced pow­er­trains, ma­te­ri­als and elec­tron­ics. Th­ese three tech­nol­ogy sec­tors play a sig­nif­i­cant role in the trans­for­ma­tion of the au­to­mo­tive in­dus­try.

Tech­nol­ogy for ve­hi­cles will con­tinue to in­crease at a rapid rate. To­day, elec­tron­ics ac­counts for 30% of a ve­hi­cle’s value and it is grow­ing day by day. The tri-state re­gion is poised to ben­e­fit from the re­search and de­vel­op­ment, de­sign, en­gi­neer­ing, and sys­tems in­te­gra­tion side of the elec­tron­ics used in ve­hi­cles, but the area may lose jobs to other au­to­mo­tive re­gions that are stronger in elec­tron­ics man­u­fac­tur­ing, par­tic­u­larly pro­duc­ers in Europe and Asia.

Five years ago, ve­hi­cles were merely a means of trans­porta­tion, but to­day cars have be­come the ul­ti­mate con­nected de­vice. By 2020, 90% of new cars will be en­abled through ex­ten­sive con­nec­tiv­ity plat­forms. Au­to­mo­biles that are in­creas­ingly in­tel­li­gent are chang­ing the con­cept of mo­bil­ity to con­sumer-driven pref­er­ences that ex­tend be­yond the ve­hi­cle it­self.

As the bound­aries of the auto in­dus­try blur and as new com­peti­tors en­ter the fray, the tra­di­tional in­dus­try par­tic­i­pants are learn­ing to thrive de­spite tech­no­log­i­cal dis­rup­tion. Elec­tron­ics, telecom­mu­ni­ca­tions and in­sur­ance com­pa­nies as well as emerg­ing start-ups are join­ing the race to find new ways to at­tract and ex­cite con­sumers to el­e­vate their ex­pe­ri­ences with cars.

Con­nec­tiv­ity is just the first step in pro­vid­ing a new ex­pe­ri­ence. Many com­pa­nies can en­able con­nec­tiv­ity, but just how use­ful is con­nec­tiv­ity with­out the abil­ity to de­rive new in­sight? Many op­por­tu­ni­ties re­main un­tapped as con­nec­tiv­ity and the In­ter­net of Things ex­pands. The key build­ing block comes from vol­umes of data flow­ing from one point to another. This data vol­ume re­mains the most press­ing chal­lenge for the auto in­dus­try: tap­ping into this data, com­bin­ing it with other in­for­ma­tion and un­cov­er­ing ac­tion­able in­sights through cloud op­er­a­tions and in­vest­ment in build­ing new busi­ness mod­els that gen­er­ate value for cus­tomers.

Con­nec­tiv­ity, and later au­tonomous tech­nol­ogy, will in­creas­ingly al­low the car to be­come a plat­form for drivers and pas­sen­gers to use their time in tran­sit to con­sume novel forms of me­dia and ser­vices or ded­i­cate the freed-up time to other per­sonal ac­tiv­i­ties. The in­creas­ing speed of in­no­va­tion, es­pe­cially in soft­ware-based sys­tems, will re­quire cars to be upgrad­able. As shared mo­bil­ity so­lu­tions with shorter life cy­cles will be­come more com­mon, con­sumers will be con­stantly aware of tech­no­log­i­cal advances, which will fur­ther in­crease de­mand for upgrad­abil­ity in pri­vately used cars as well.

In do­mains like the in­ter­net and com­mu­ni­ca­tions, tra­di­tional high-tech play­ers such as Mi­crosoft and Qual­comm con­trib­ute most of the in­no­va­tion. Con­se­quently, the en­gi­neer­ing ranks of car man­u­fac­tur­ers are still pre­dom­i­nantly com­posed of me­chan­i­cal and elec­tri­cal en­gi­neers rather than soft­ware and elec­tron­ics en­gi­neers. And, even though more than 75% of au­to­mo­bile in­no­va­tion stems from elec­tron­ics, car man­u­fac­tur­ers have not yet fully em­braced elec­tron­ics. Even so, al­most ev­ery car com­pany has ac­knowl­edged that fu­ture suc­cess lies in cre­at­ing ve­hi­cles that are dif­fer­en­ti­ated by elec­tron­ics and soft­ware, rather than just by de­sign and brand­ing. Numer­ous ini­tia­tives, such as BMW’s Con­nected-Drive, ex­em­plify this in­dus­try-wide vi­sion.

Stricter emis­sion reg­u­la­tions, lower bat­tery costs, more widely avail­able charg­ing in­fra­struc­ture, and in­creas­ing con­sumer ac­cep­tance will cre­ate new and strong mo­men­tum for pen­e­tra­tion of elec­tri­fied ve­hi­cles (hy­brid, plugin, bat­tery elec­tric, and fuel cell) in the com­ing years. The speed of adop­tion will be de­ter­mined by the in­ter­ac­tion of con­sumer pull (par­tially driven by to­tal cost of own­er­ship) and reg­u­la­tory push, which will vary strongly at the re­gional and lo­cal level.

In­dus­try sources say that, in 2030, the share of elec­tri­fied ve­hi­cles could range from 10% to 50% of new-ve­hi­cle sales. Adop­tion rates will be high­est in de­vel­oped dense cities with strict emis­sion reg­u­la­tions and con­sumer in­cen­tives (tax breaks, spe­cial park­ing and driv­ing priv­i­leges, dis­counted elec­tric­ity pric­ing, et cetera). Sales pen­e­tra­tion will be slower in small towns and ru­ral ar­eas with lower lev­els of charg­ing in­fra­struc­ture and higher de­pen­dency on driv­ing range.

A top of­fi­cial of an OEM said, “Through con­tin­u­ous im­prove­ments in bat­tery tech­nol­ogy and cost, those lo­cal dif­fer­ences will be­come less pro­nounced, and elec­tri­fied ve­hi­cles are ex­pected to gain more and more mar­ket share from con­ven­tional ve­hi­cles. With bat­tery costs po­ten­tially de­creas­ing to $150 to $200 per kilo­watt-hour over the next decade, elec­tri­fied ve­hi­cles will achieve cost com­pet­i­tive­ness with con­ven­tional ve­hi­cles, cre­at­ing the most sig­nif­i­cant cat­a­lyst for mar­ket pen­e­tra­tion. At the same time, it is im­por­tant to note that elec­tri­fied ve­hi­cles in­clude a large por­tion of hy­brid electrics, which means that even be­yond 2030, the in­ter­nal­com­bus­tion en­gine will re­main very rel­e­vant.”

In many ways, the au­to­mo­bile and high-tech in­dus­tries are very dif­fer­ent. Both in­dus­tries have trans­formed the world and em­ploy mil­lions of peo­ple glob­ally, drive eco­nomic growth, spend tens of bil­lions of dol­lars in R&D ev­ery year, and are founded on rig­or­ous in­no­va­tion. More­over, the line be­tween the au­to­mo­bile and high-tech in­dus­tries is blur­ring. As ev­i­dence, cars and trucks are now one of the most pop­u­lar at­trac­tions at the Con­sumer Elec­tron­ics Show (CES), the world’s largest elec­tron­ics event, held each year in Las Ve­gas.

At CES 2018, the em­pha­sis was still elec­tri­fi­ca­tion, with flashy EV launches from the likes of By­ton and Fisker. There was also a dou­bling down on au­tonomous driv­ing tech­nol­ogy. Com­pa­nies are now get­ting con­fi­dent about demon­strat­ing their self-driv­ing cars, in­clud­ing some with­out any hu­man con­trols. Mer­cedes sent a smart vi­sion EQ for two con­cept back and forth along a por­tion of the Las Ve­gas strip to show what a ride­hail­ing ser­vice of the fu­ture could look like. This shows, man­u­fac­tur­ers are more ea­ger than ever to tell you au­tonomous, elec­tric cars are the fu­ture, and that they’re help­ing make it hap­pen.

Some of the most talked about de­vel­op­ments at the show con­cerned car mak­ers us­ing ar­ti­fi­cial in­tel­li­gence to power new dash­boards and in­fo­tain­ment sys­tems. The big names here were Hyundai and Mer­cedes, each with a dif­fer­ent take on how drivers will con­trol the ve­hi­cle of the fu­ture.

Hyundai took the wrap­per off its In­tel­li­gent Per­sonal Cock­pit, which amounts to a new kind of dash­board that uses AI to dy­nam­i­cally dis­play in­for­ma­tion and telem­at­ics to the drive as well as man­age voice recog­ni­tion and a sys­tem that’ll keep track of the driver’s vi­tal signs in case of emer­gency.

Mer­cedes called its smart cock­pit the MBUX, which stands for Mer­cedes-Benz User Ex­pe­ri­ence. A lit­tle more vis­ual than Hyundai’s so­lu­tion, the MBUX was shown dur­ing a pre­sen­ta­tion to have three-di­men­sional dig­i­tal dis­plays and also re­spond to voice con­trol and a touch screen. The sys­tem would add new fea­tures via over­the-air up­dates. The whole thing is nicely de­signed with min­i­mal­ist dis­plays that Mer­cedes hopes will make it eas­ier on drivers to un­der­stand their ve­hi­cle’s in­ner work­ings—some­thing the com­pany’s cars are def­i­nitely not known for to­day.

Other in­tel­li­gent cock­pit con­cepts were on dis­play from many third­party mak­ers, in­clud­ing Denso and Pi­o­neer, but most are still in the early stages of con­cept de­sign. Both Hyundai and Mer­cedes hope to have their im­ple­men­ta­tions in the real world in the next year or two. Many other mak­ers an­nounced au­tonomous ve­hi­cle projects ei­ther from their own R&D de­part­ments or in con­junc­tion with third-party ve­hi­cle op­er­at­ing sys­tem mak­ers, like In­tel’s Mo­bil­eye and Nvidia; th­ese in­clude BMW, Fiat-Chrysler, Honda, NIO, and SAIC. Au­tonomous cars are by def­i­ni­tion con­nected cars and the amount of data that needs to be mov­ing be­tween an au­tonomous car and its im­me­di­ate en­vi­ron­ment, its maker’s data and con­trol cen­ters, as well as its driver’s con­trol and in­fo­tain­ment re­sources is, in a word, huge. Not only that, many of th­ese data trans­fers need to hap­pen with lit­tle or no la­tency, some­thing that’s be­yond to­day’s 4G LTE net­works.

Fully au­tonomous ve­hi­cles are un­likely to be com­mer­cially avail­able be­fore 2020. Mean­while, ad­vanced driver-as­sis­tance sys­tems (ADAS) will play a cru­cial role in pre­par­ing reg­u­la­tors, con­sumers, and cor­po­ra­tions for the medium-term re­al­ity of cars tak­ing over con­trol from drivers.

The mar­ket in­tro­duc­tion of ADAS has shown that the pri­mary chal­lenges im­ped­ing faster mar­ket pen­e­tra­tion are pric­ing, con­sumer un­der­stand­ing, and safety/se­cu­rity is­sues. Re­gard­ing tech­no­log­i­cal readi­ness, tech play­ers and start-ups will likely also play an im­por­tant role in the de­vel­op­ment of au­tonomous ve­hi­cles. Reg­u­la­tion and con­sumer ac­cep­tance may rep­re­sent ad­di­tional hur­dles for au­tonomous ve­hi­cles. How­ever, once th­ese chal­lenges are ad­dressed, au­tonomous ve­hi­cles will of­fer tremen­dous value for con­sumers (for ex­am­ple, the abil­ity to work while com­mut­ing, or the con­ve­nience of us­ing so­cial me­dia or watch­ing movies while trav­el­ling).

Soft­ware com­pe­tence is in­creas­ingly be­com­ing one of the most im­por­tant dif­fer­en­ti­at­ing fac­tors for the in­dus­try, for var­i­ous do­main ar­eas, in­clud­ing ADAS/ ac­tive safety, con­nec­tiv­ity, and in­fo­tain­ment. Fur­ther on, as cars are in­creas­ingly in­te­grated into the con­nected world, au­tomak­ers will have no choice but to par­tic­i­pate in the new mo­bil­ity ecosys­tems that emerge as a re­sult of tech­no­log­i­cal and con­sumer trends. With in­no­va­tion and prod­uct value in­creas­ingly de­fined by soft­ware, OEMs need to align their skills and pro­cesses to ad­dress new chal­lenges like soft­ware-en­abled con­sumer value def­i­ni­tion, cy­ber­se­cu­rity, data pri­vacy, and con­tin­u­ous prod­uct up­dates.

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