Manufacturers embracing software in race for autonomy

The Volkswagen Group’s internal software development company, Cariad SE, has signed a deal with China’s Horizon Robotics, a leading developer of AI hardware and software. In addition to a US$1 billion investment into Horizon directly, Cariad will invest an additional US$1.26 billion to take a 60% stake in a new joint venture with Horizon. This joint venture plans full stack development of both advanced driver assistance systems (ADAS) and autonomous driving (AD) software that will integrate numerous vehicle functions onto one chip, a system-on-chip design (SoC). SoCs are cost savers. They require fewer semiconductors overall to drive the car yet increase operating system stability and reduce system energy consumption. Fulfilling Volkswagen’s ‘Made in China, For China’ initiative, the joint venture represents an increasing split in the industry: one where two teams develop the same technology or software in parallel but deliver the results separately – one for China and the other for the rest of the world. This is true for Volkswagen, as Cariad is also collaborating with the Bosch Group in Germany to deliver the same ADAS/AD software and system architecture for use there. The joint venture with Horizon is designed to stop Volkswagen’s plunging EV sales in China. The ID 4 electric crossover made its debut a year ago, with expectations of sales in excess of 150,000 units. Instead, Chinese buyers found the ID 4’s lack of over-the-air updates and minimal digital offerings wanting and they purchased domestic new-energy vehicles with the more established digital ecosystems that appeal to them. This story is an extract from the November 2022 issue of AutoForecast Solutions' monthly report. Click here to download the full report, or to catch up on previous months. In September, Cariad's failure to deliver a unified operating system for use across the group’s EVs cost former CEO Herbert Diess his job. Regaining market share is critical for Volkswagen, in China and the rest of the world. Designing cars around software Hyundai Motor Company is committed to spending US$12.6 billion (£10.4bn) between now and 2030 to create its Global Software Centre (GSC). The new entity will be tasked with creating and implementing the operating system and over-the-air upgrade capabilities needed to allow Hyundai to build software-defined vehicles with the launch of two new EV platforms in 2025: eM and eS. “Creating visionary vehicles empowered with the ability to evolve through software will enable customers to keep their vehicles up to date with the latest features and technology long after they have left the factory.” That is the Global Software Division’s key mission, according to the President of Hyundai’s R&D Division, Chung-Kook Park. All Hyundai Group vehicles, both EV and ICE, will be equipped with the internally developed Connected Car Operating System (ccOS), which will allow all Hyundai vehicles access to vehicle access to over-the-air upgrades, personalised services, and up to Level 3 autonomy using the eM platform. The eS platform will be developed as a skateboard underpinning purpose-built vehicles for B2B applications, such as delivery, logistics and even car-hailing services. The group’s ccOS will be loaded onto the Nvidia Drive platform, designed for large-scale data processing needed by the lidar, cameras and radars for the Level 3 autonomy that will be deployed in future eM-based vehicles. The Global Software Centre will create software-defined mobility devices and solutions that extend beyond the vehicle, entering the larger mobility ecosystem. Hyundai’s Global Software Group is among the first legacy OEM software organisations to embrace and pursue this idea. Tech firms targeting a slice of the mobility sector Sony Honda Mobility is a joint venture with roots in both legacy OEM vehicle production, from Honda, and deep software development experience, from Sony. So it came as something of a surprise that in the press conference announcing the founding of Sony Honda Mobility, CEO Yasuhide Mizuno, the former automotive head at legacy automaker Honda, declared: “The mobility industry is reaching a time of transformation, with digital technology and software at the epicentre. Leading that transformation requires a completely different approach from the way that existing original equipment manufacturers do things.” Perhaps it should not have been such a surprise, after all. The Sony Honda Mobility focus on software-driven development has its foundations in Honda’s establishment of a computer science research centre in Silicon Valley in 2000. Five years later, Honda’s research centre evolved to investing in start-ups that embraced open innovation in their software platforms. Meanwhile, Sony’s 2016 revival of Aibo, the robot dog, led the company to concentrate on EVs as a way to bring about company success with software-defined vehicles. With that mutual interest in software-defined vehicles, Sony Honda Mobility plans to build smart vehicles that rely on open innovation software development to supply users with digital products and services that complement their lives outside the car, while over-the-air updates enhance their experience inside the car. Open innovation software development allowed outside developers to create content for Sony’s PlayStation, succeeding with the gaming community far beyond anything that Sony could have accomplished by itself. The joint venture will begin taking reservations in early 2025 and deliver technologically sophisticated and engaging customer vehicles towards the end of that year. Conrad Layson