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Customer LoginsVideo: Electronic technology in the automotive industry: What's the impact?
Electronics are changing how vehicles are designed, built, and driven. They are shaping companies' business models-and customers' buying decisions.
Interview Transcript
Automotive electronics is probably one of the most, if not the most important trend in the global automotive industry today. It really impacts on every part of the car, the powertrain, infotainment, safety, convenience and comfort.
Really, we're seeing that where global OEM's would want masses of aerodynamics, of engine design, of powertrain, they're really having to become specialists in technology, in communication, and in semiconductors.
What we're actually seeing from IHS's consumer research, is that consumers are really putting a lot of value on electronics and technology with regard to the purchasing decision so it's really becoming important, it's becoming a key factor, in the overall buying decision.
What is causing the impact and how?
There's a number of factors that are really pushing technology in cars that we see today. Firstly, there's the ubiquity of technology that's coming from consumer electronics. That's pushing down the prices of a lot components. Things like semiconductors, screens, LED's, are a lot cheaper and can be used more widely in automotive.
We're seeing growing demand for better safety in vehicles. Particularly in North America and Europe, there's been good progress with education on drink driving, but still a lot of people are hurt or killed in road traffic accidents. Bringing technology to bear with collision avoidance, collision mitigation, is bringing a lot of new technology into the vehicle.
One of the other trends that we see is increasing electrification of the powertrain. We see, at the moment, hybridization, stop-start technology to reduce emissions and then longer term to comply with global legislation on CO2, we see increasing use of plug-in hybrid electric vehicles and battery electric vehicles.
Which vehicle systems will be most affected?
We're seeing electronic technology in automotive in virtually every area but probably two of the most important, or two of the most dynamic are infotainment, so when drivers are using navigation or their audio system, we talk about this concept of ubiquity of connection. They're very used to using a smart phone when they're in the house or when they're out with their friends, so they want to continue that experience when they are in the vehicle. To be able to make use of, not just their telephone and their music, but they also want to be able to make use of their applications and other features.
The second area that's really exciting, is advanced driver assistant systems. There's a lot of legislation in North America and Europe to improve the safety of vehicles. We're seeing it add a lot of technological innovation and hardware to vehicles. Perhaps one of the most exciting long term trends is autonomous driving. This is really big news for the automotive industry because it's going to challenge a lot of the existing design considerations, a lot of the business models. It's going to impact the insurance industry.
If driving becomes safer, what does it do for liability? What does it do for insurance claims? We see it as being one of the longer term, most dynamic trends in the automotive industry.
What will cars be capable of 10 years from now?
The car of the future, if we look at 10 years, is going to be significantly different to what we see today. If we look at entertainment, we can expect to see a raft of technologies come into the vehicle and be distributed on a wider range of vehicles. We'll see things like touch technology widley being used. We'll start to see things like proximity sensing, gesture recognition, and we'll start to see connectivity being much more widely used, people being able to connect to the internet while also traveling, use Google through their vehicle head unit, for example, to search for locations.
In addition to that, we see big advances in autonomous driving. Towards the end of our ten year period, we expect to start to see autonomous driving becoming more of a reality. At the moment, we have a number of advanced driver assistant systems that could contribute to that type of implementation, to making use of radar and lidar to detect other cars and to detect the surroundings of the vehicle.
Then we also expect to see additional advances in power-train electrification. We already have hybridization at the moment, in a number of vehicles, and that's primarily for fuel saving. We'll expect to see that technology being used more widely and we'll expect to see a greater prevalence of plug-in hybrid electric vehicles and battery electric vehicles.
All of those technologies require more hardware, more electronic hardware, more semiconductor content and will really boost this electronic content within the vehicle.
How can OEM's & suppliers adapt, thrive and survive?
The technology that's coming into vehicles at the moment poses significant challenges for OEM's and tier ones who are supplying to the automotive industry. There's an argument that says that some of the developing technologies might kill the car as we know it. Certainly what they will do is change the way that automobiles are designed, and change the way that consumers interact with them and buy those vehicles.
OEM's and suppliers need to keep abreast of current technologies, understand what their competitors are doing, understand what's currently available and where key trends in semiconductors and infotainment are going.
Also, they need to partner with the new companies that are getting in this space. We see companies like Google. We see companies like Apple making a play in automotive. What OEM's and suppliers need to do is partner with those companies and make use of the innovations they're able to drive.
Alastair Hayfield, Associate Director, IHS Automotive
Posted 20 May 2014