Connected Car Manufacturers’ Focus on Software-driven Vehicles Allows for Cross-industry Collaborations
May 2, 2017 | Frost & SullivanEstimated reading time: 2 minutes
Innovations in the connected car market have revolved around data monetisation, with start-ups developing new apps and hardware/interfaces (smart phone pairing) or offering services like prognostics. Acknowledging the potential in data explosion, automotive suppliers are attempting to capture and sell car data by leveraging their software and hardware platforms. While over-the-air (OTA), human-machine interface (HMI) and connected services generate direct revenue streams, Big Data analytics will help save costs and accelerate returns on investments (ROI) for automotive original equipment manufacturers (OEMs).
A notable example of cross-industry collaboration is the integration of virtual assistants such as Amazon Alexa into the vehicle. This allows non-automotive players to invest in connected homes and cars,” said Frost & Sullivan Mobility Analyst Siddhanth Kumaramanickavel. “Companies like Maluuba, iNAGO, Promptu, Sensory and Baidu also are working on offering natural speech assistants, artificial intelligence (AI)-enabled speech assistants, and voice biometrics to automotive manufacturers.”
Global Connected Car Market Outlook, 2017 is part of Frost & Sullivan’s Automotive & Transportation Growth Partnership Subscription. The study forecasts that global connected car shipments will increase from around 25 million to almost 70 million units by 2022.
The adoption of 4G long-term evolution (LTE) has increased connected car uptake and widened the subscriber base for telematics services. However, retention rates following free trials remain low. To attract more buyers, car manufacturers are experimenting with new service models such as product-as-a-service. Commission-based and transaction volume-based models will define revenue streams as businesses move toward this model.
So far, smart mobility, cybersecurity and software-defined cars have proven the key areas of interest across Europe, North America and China.
North America: This region leads in LTE penetration. Volkswagen is expected to commercialise 5G-based services by 2020, while Toyota and Ford have collaborated to build an open-source infotainment framework, forming a consortium with other manufacturers. Manufacturers are also investing in white hat hackers for swift response to security threats, as safety is a bigger priority than comfort or convenience. Smart mobility and autonomous vehicles remain the focus areas for OEMs.
Europe: Telematics penetration is still growing in this region. Mass-market OEMs are able to offer basic eCall services, while premium OEMs are packaging connected navigation as a suite of connected services.
China: The country is focusing on data analysis, Internet-vehicle platform building and urban intelligent transport. Baidu’s partnership with BMW and NVIDIA for AI and with Harman suggests a strong footprint for connected automated cars. China is expected to be the largest market for connected cars due to a positive economic outlook.
Japan and Korea: In spite of technological advancements, these countries lag in the connected car space.
“As North America and Europe are generating ROI from connected, automated and mobility-related services, OEMs are focusing on introducing the same experience in emerging regions,” noted Kumaramanickavel.
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today's market participants. For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community.
Suggested Items
LQDX Divests Aluminum Soldering Business - Mina™ - to Taiyo America Inc.
05/02/2024 | PRNewswireLQDX, formerly known as Averatek Corp., developer of high-performance materials for advanced semiconductor manufacturing, today announced that it has divested its aluminum soldering business – known as MinaTM – to Taiyo America Inc., a global market leader in advanced electronic materials.
IDTechEx Report on Quantum Technology: Nano-scale Physics for Massive Market Impact
04/30/2024 | PRNewswireThe quantum technology market leverages nano-scale physics to create revolutionary new devices for computing, sensing, and communications. Across the industry, quantum technology offers a paradigm shift in performance compared with incumbent solutions.
Guerrilla RF Completes Strategic Acquisition of GaN Device Portfolio from Gallium Semiconductor
04/29/2024 | BUSINESS WIREGuerrilla RF, Inc. has finalized the acquisition of Gallium Semiconductor's entire portfolio of GaN power amplifiers and front-end modules. Effective April 26th, 2024, GUER acquired all previously released components as well as new cores under development at Gallium Semiconductor.
Amphenol Reports Q1 2024 Results, Announces New Stock Repurchase Program
04/26/2024 | BUSINESS WIREAmphenol Corporation reported first quarter 2024 results. In addition, the Company is announcing a new three-year, $2 billion stock repurchase program.
Chinese Smartphone Market Maintains its Recovery Momentum at 6.5% Growth in 1Q24,
04/26/2024 | IDCAccording to preliminary data from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, China smartphone shipments grew 6.5% year over year (YoY) to 69.3 million units in 1Q24.