The Internet of Things (IoT) facilitates connectivity between automobiles, devices, and special features. This approach would also reduce overall system complexity and development costs, with suppliers providing native compatibility with the architecture base across each component they provide. SYCL). For infotainment, the leading options for upcoming vehicles stem from the smartphone industry, with automotive variants of mobile operating systems becoming common. Take thermodynamics, for example. What’s next for software development in the automotive industry? As autonomous technology advances, a profound shift in consumer behaviour will alter the revenue model and value chain of the industry. Reinvent your business. All Rights Reserved. As software content rises in nearly every part of the vehicle, so does the effort required to make different systems work as a cohesive whole. We strive to provide individuals with disabilities equal access to our website. The first indicator of just how important software development is in the automotive industry, there’s the fact that in 2020, its market share is $12,611,000,000. It’s responsible for powering features and products including: Some of these devices, including cameras and sensors, allow automotive companies to gather data on driving behaviors. Automotive software development in recent years has changed vehicle architectures and increased the quality of security and functional safety. With the gap between complexity and productivity widening, OEMs and tier-one suppliers will soon face a massive talent shortage and a huge increase in development costs. The path to an end-to-end platform will be complex, with some stakeholders assuming new roles or venturing into new software areas, and there is still much uncertainty ahead. Since 2003, they have been working on the development and introduction of an open, standardized software architecture for the automotive industry. Accelerate product innovation and delivery for the digital mobility industry. With the automotive revolution that the above trends outline, it's inevitable that new, non-traditional players will enter the market. Please try again later. Without further ado, below we’re going to list some of the most disruptive trends in automotive software development in 2019. Developers working on different software stacks across a vehicle seldom coordinate their activities, however. In addition to enabling the deployment of an end-to-end software platform, this partnership could provide the tech company with complete control over hardware and software integration—a common pain point that often results in delays or suboptimal performance in the current development process. For instance, as software becomes increasingly important, they will need to build solid … Software development within the auto industry is more than just systems in place to make drivers more comfortable and travels safer. OEM collaborations will not automatically produce excellent software, even if the companies involved have complementary skills. Please click "Accept" to help us improve its usefulness with additional cookies. Consider the following: These efforts represent a step in the right direction, although they still fall short of the comprehensive integration required to make an end-to-end platform viable. And in order to remain competitive in the industry, companies will need to employ developers who can help them stay … Eight trends affecting automotive software development 1. This piecemeal approach is common among industry leaders because no single software platform on the market can meet all cross-system needs. And in order to remain competitive in the industry, companies will need to employ developers who can help them stay ahead of the curve, whether that means the outsourcing of software development to onshore or offshore providers or training in-house personnel. It looks like 3D-printed cars may be heading into the mainstream market, and license plate recognition (LPR) software has the potential to improve security and the flow of traffic. OEMs might have little leeway to ask for changes in the platform, especially if the tech company is providing it for free. Ryan Fletcher is an associate partner in McKinsey’s Southern California office, where Abhijit Mahindroo is a partner; Nick Santhanam is a senior partner in the Silicon Valley office; and Andreas Tschiesner is a senior partner in the Munich office. Strategic software development partner for enterprises and Fortune 500 companies. More than a mission statement: How the 5Ps embed purpose to deliver value, What’s next for remote work: An analysis of 2,000 tasks, 800 jobs, and nine countries, Mapping the automotive software-and-electronics landscape through 2030. Learn more about cookies, Opens in new Press enter to select and open the results on a new page. Established OEMs are likely to take note of this proof point and could follow a similar model for their next vehicle platforms. Security and safety vulnerabilities can be rapidly identified and addressed. Software development has become one of the key areas in the automotive industry. But they need not bring all development in house. Instead, they will have to streamline software development by reducing complexity. Internet of Things and Artificial Intelligence . And development productivity could considerably improve, with OEMs adding new cross-domain features over time, without extensive software rewrites, by leveraging a common code base throughout the vehicle. The enormous cost of integrating and upgrading the features that consumers increasingly expect, including high-end onboard assistants and advanced driver-assistance systems (ADAS), is also daunting. While the flying cars of 1982’s Blade Runner may still be a ways away, the seemingly impractical, if not impossible, futuristic visions of automobiles dreamed up by filmmakers and engineers alike are becoming more of a reality with every passing day. The transition from formerly hardware-based products to a software-based, service-driven world is particularly challenging for traditional automotive manufacturers. And how can software development providers meet these demands? cookies, McKinsey_Website_Accessibility@mckinsey.com. Many automotive manufacturers are turning to software development outsourcing or engaging software development services to enhance the safety features on their vehicles. Security could greatly expand, enabling one overarching solution to monitor the full code base—not just at a handful of interfaces. These connections provide a conduit for attacks to spread through a car, since software vulnerabilities in one system can be exploited to provide access to other systems. About AUTOSAR AUTOSAR (AUTomotive Open System ARchitecture) is a worldwide development partnership of car manufacturers, suppliers and other companies from the electronics, semiconductor and software industries. These players have also found ways to reuse a single software architecture across many types of devices, substantially reducing the need for redesign. And you can’t even call the automobile industry a community because everybody is frightened of being outperformed by a competitor if they share anything about how they develop software … © 2020 - Market Business News. OEMs and tier-one suppliers therefore face a daunting task of interface control and integration, creating major challenges in development, security, and performance. Technology is changing the face of the automotive industry, and with the dramatic shift in the products and features that are available to consumers — and the very way people drive — the need for innovative software development services becomes all the more pressing every day. Today’s hardware-defined cars are rapidly transforming into software-defined transportation platforms. By the year 2023, this value is expected to reach almost $13 billion. A major tech player recently acquired a tier-one infotainment provider, for instance. OEMs might compete for market share, but partnerships among traditional rivals are well known in the space, especially when companies have a common interest. With big data come big opportunities. For instance, three German OEMs formed a consortium to acquire a mapping business, then worked together to improve the system for automotive use. While technology companies worldwide have adopted agile and lean principles for software development, the automotive industry lags behind. Shifting to a software-centric mind-set could simply mean defining and maintaining the core end-to-end foundation and insisting upon adherence as part of the supplier-relationship construct. Use minimal essential hereLearn more about cookies, Opens in new The industry is turning to software development companies to create solutions for managing and storing large quantities of data. For OEMs, the issue is capability. Connectivity inside a vehicle is also paramount. A Radical Shift in Consumer Behaviour. We are here to provide the right solutions for every company in need. Most recently, other researchers demonstrated the ability to disable antitheft systems, doors, lights, and brakes through a Wi-Fi connection. As the automotive industry is transitioning from hardware- to software-defined vehicles, the relevance of software for core technology trends is increasing rapidly. Although this represents a fundamental shift in approach, it is likely to prove to be a critical lever against the threat of disruptive OEMs. As vehicles become increasingly connected, they are producing more and more data — data that could potentially become a huge source of revenue for automotive companies. That is an important benefit, since OEMs fear becoming low-margin hardware players—a fate that has befallen many mobile companies that adopted outside software platforms. People create and sustain change. These systems are not always backward compatible and thus require extensive redevelopment every few years to stay up to date with new features and performance. Although software has been the critical enabler of today’s infotainment capabilities, new complications are arising. Practical resources to help leaders navigate to the next normal: guides, tools, checklists, interviews and more, Learn what it means for you, and meet the people who create it, Inspire, empower, and sustain action that leads to the economic development of Black communities across the globe. While the acquisition of an OEM or leading tier-one supplier could be a radical move in the tech industry, such bold deals are not unprecedented. The complexity jump is also creating a host of new, difficult-to-trace security risks for connected vehicles. The industry has many technical and commercial dynamics, but early signs point to the following possible routes. To compete with these new entrants, carmakers will have to redefine their role in the auto industry, and either assume new business models, or gain new competences. How Software Will Dominate the Automotive Industry. The same pattern occurred with the German OEM collaboration, with other major OEMs licensing mapping data from the original three partners after their initial success. Access to the pool of 1,000+ software engineers in-house and 588,000+ developers in CEE. Despite the clear importance of software to vehicle performance, the development of automotive-software modules frequently occurs in isolation. They can also unlock doors remotely via their mobile devices. That’s why automotive makers partner with software development companies like Codete to develop functional software systems and gain a competitive advantage in this rapidly changing industry. Of this effort, 30 to 50 percent is commonly dedicated to integration, given the broad network of suppliers involved in development. They will also need agile development frameworks, top talent, and efficient governance systems. The key driver for the automotive software industry in this region is the rapid development of intelligent transport systems and connected mobility in countries such as China and Japan. Unleash their potential. This change reduced development complexity and enabled new cross-domain functionality, such as flight-propulsion systems that use camera data for navigation and obstacle avoidance. For electric vehicles (EVs), software is even more critical, particularly for trade-offs between performance and range. We are on the verge of automotive industry revolution, and it all starts with Automotive Software Development. Although established players have strong incentives to maximize reuse of current electronics architectures, new entrants can take a ground-up approach to vehicle development while reshaping the construct for supplier engagement. Such a construct would provide a solution to many of the pain points present in today’s fragmented ecosystem. Most collaborations will probably be small at first, involving only two or three OEMs, but other players might become interested if an alliance creates core components with attractive features. Drivers can control their environments through voice-activated navigation systems. First and foremost, Artificial Intelligence (AI) and Machine Learning (ML) have an essential part in the future of the auto industry as predictive capacities are getting more predominant in autos, customizing the driving adventure. Automotive Dealerships and auto shops are streamlining their working with custom automotive management software.