February 25, 2024

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The Connected Vehicle: A Promising Journey Beckons

by Prashant Vishnupad – Global Head of Industrials, LatentView Analytics

Picture this: The number of connected cars is set to increase to 352 million by the end of 2023, compared with 119.4 million in 2018. By 2030, more than 95 percent of passenger miles will be served by autonomous cars. And by 2025, the globally connected car market is projected to reach $166 billion—up from an estimated $54 billion in 2020. 

The automotive industry is grappling with greater disruption than ever before. From mobility services to supply chain challenges and the growing pressure to become more sustainable, the industry is at an inflection point. Clearly, the success of the connected vehicle sector depends on how it can drive changes in areas like digital transformation and move towards electrified and autonomous driving. 

The CASE for Connected Vehicles 

CASE, or Connected, Autonomous, Shared and Electrified, are the four

Ford Argo Self Driving Car. Credit: Phillip Pessar via Wikimedia

megatrends driving the industry overhaul in the automotive sector. Each of these trends involves the use of connectivity to enable new applications and services. The connected vehicle market can be segmented based on the type of service provided, such as Remote Vehicle Diagnostics, Over-the-Air Software, Collision Warning Systems, Automated Parking, Remote Vehicle Operation, Remote Asset Monitoring, Vehicle Design and Development, Vehicle Management, and more. 

Software-defined vehicles are pushing the industry to adopt massive changes, not only in hardware but also in the way automotive manufacturers connect with their customers. Primarily, these changes impact the onboard operating systems and the way telematic control units (TCUs) upload data from the car to the cloud. 

A Data Intensive Platform

A point to note is that a massive 4,000 GB of data will be used by a single autonomous car … every day! Do OEMs and other stakeholders have the capability to analyze and benefit from this data? Creating an efficient ecosystem to support this voluminous movement of data will require integrated microservices, middleware, and APIs—all necessary for the widespread adoption of autonomous vehicles.

As software architecture shapes the future of the sector, automotive CIOs, CTOs, and CDOs need to take advantage of the current opportunity by prioritizing the capabilities and differentiating features of their vehicles and connecting with service providers to deliver next-gen customized experiences. As car manufacturers begin to think beyond traditional car features like feature design and engine power, they should invest in cutting-edge digital capabilities like personalized subscription services and a range of on-demand features from a centralized digital cloud.  

Connected vehicles will play a huge role in driving the future of the industry. And this will happen in conjunction with rapid data proliferation, which can be monetized to help reduce costs or optimize R&D. However, when it comes to assembling substantive data to stay ahead, carmakers need a sizable user base compared with their competitors. At present, the usage levels are insufficient, and carmakers need to clearly establish their place in the connectivity ecosystem.

Re-engineering Mobility 

Manufacturers today are also burdened by legacy systems; to enable connected vehicle solutions, cloud based data platforms are needed so that data science based connected applications can be built over them. However, many OEMs are at different levels of maturity when it comes to having the right digital architecture to enable these solutions. Those OEMs that build the right digital architecture for connected mobility, will be able to differentiate their product and service offerings and gain an edge in the future of the automotive industry’s transformation.  

Many vehicles are compatible with connected services like Apple CarPlay and Android Auto, which effectively replaces a carmaker’s infotainment system with something more familiar to smartphone users. However, if people are already using third-party applications from major tech players, making these features even more accessible through their vehicle’s interface is key to bringing customers—and their data—back into the fold. But the pace has been slow, and it will need major investments in the connected space to address this challenge.

Looking at the Road Ahead 

While the automotive industry is rapidly adapting to the new business models required to enable CASE—and building the technology stack required to enable the transformation—we have to realize that OEMs cannot do this alone. But the good news is that the transition from hardware to software-supported vehicles has begun.

Traditional tier 1 suppliers are merging with new partners in unexpected areas. For example, Qualcomm, AI providers, and telecommunications companies like Verizon are now part of the connected vehicle ecosystem. Of late, we are seeing a convergence across multiple industries thereby enabling the connected vehicle transformation in the automotive industry. Hi-tech companies like Google and Amazon are partnering with automotive OEMs to build cloud solutions and architectures that are critical to enable connectivity.

Similarly, retail companies are providing solutions like EV charging maps; financial services companies are partnering with ride-sharing companies to enable automotive mobile payment systems; and utility companies are talking to automotive OEMs to ensure the power needed for EVs is available when and where required. 

Additionally, pure-play data science and engineering firms are fast emerging, armed with the much-needed expertise in implementing advanced solutions in technology, fintech, retail, and automotive industries. OEMs should leverage the deep knowledge of such service providers to accelerate their own transformation. 

The connected vehicle is the future. Technology has made this possible, and drivers can now look forward to when self-driving and electrified cars will enable new connected vehicle applications that will simplify and enhance their driving experience. For connected cars, the ecosystem is not just within the vehicle; automotive leaders should realize a car is just one entity in the consumer’s digital environment. It is not enough to merge connected services into a seamless in-car experience. That experience must also fit seamlessly into their entire digital lives.

By I&T Today

By I&T Today

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