Skip to main content

Demand for Connected Software-Defined Automobiles

Major car manufacturers and their key suppliers are changing legacy business models to better accommodate the evolving market demand for personal transportation. The automotive industry will undergo several transformative paradigm shifts over the next 25 years.

These stages include the connected software-defined car, sensors and big data, cooperative mobility, Internet of Things (IoT), electrification, car sharing and driverless cars.

While the first phases are already underway, the latter phases will start to drive the market forward within the next 10 years.

Car manufacturers are currently revamping vehicle electronics and networking architecture to ensure every sub-system is connected and software-defined, according to the latest market study by ABI Research. Moving toward the next decade, the automotive industry will achieve cooperative mobility.

Cars will communicate with each other, surrounding infrastructure and environments. Electrification will then change the way consumers power their vehicles. And, lastly, car sharing and driverless cars will likely lead to a significant automobile market consolidation.

Ongoing Disruption of the Legacy Ecosystem

"The final three stages -- cooperative mobility, electrification, and car sharing leading to driverless cars -- will be the most disruptive to the automotive industry," says Dominique Bonte, vice president at ABI Research. "Not all car manufacturers will survive the changing landscape. And newcomers will also emerge, ones eager to create new, software-defined, high-tech cars."

Through this industry fluctuation, there will be a number of opportunities for manufacturers and vendors to reinvent themselves. Gas stations will need to rethink their market strategy and offer new services, such as electric charging stations, or risk losing their relevance completely.

Taxi companies are already feeling the rising pressure, meeting stiff competition from Uber and other new car sharing services. Dealerships and insurance vendors also face potential upset.

Semiconductors and software companies, on the other hand, have a huge future, as cars continue to incorporate more sensors and computing technologies into their architectures.

"Think beyond smart, sustainable mobility, and soon we may witness a new trend that links smart mobility to virtualized lifestyles," concludes Bonte.

As people start engaging in more virtual reality experiences at home, will there be as strong a need for road transportation? It's a far look into the future but a scenario that could definitely send the automotive industry into a tailspin.

Popular posts from this blog

How AI is Reshaping Business Communication

The typical customer engagement model is undergoing a dramatic transformation, driven by the convergence of Conversational AI, Generative AI  (GenAI), and an emerging technology called Agentic AI. As business leaders seek to automate and enhance their customer interactions, these technologies are creating new possibilities for more natural, contextual, and efficient communication at scale. The numbers tell a compelling story. According to Juniper Research's latest analysis, the conversational AI market is poised for substantial growth. Revenue is projected to surge from $14.6 billion in 2025 to over $23 billion by 2027. Artificial Intelligence Market Development The vendors in this industry are expected to generate a remarkable $57 billion globally over the next three years. This growth reflects the increasing enterprise adoption of AI-powered communication solutions across various sectors. What's particularly interesting is the regional distribution of this market. The Far Ea...