Automakers such as GM, Ford and Volvo deepened ties with key technology partners at this year's CES to prepare for electric vehicle challengers Tesla and Apple, which are accelerating their entry into the market.
The big three chip companies — Intel-owned Mobileye, Qualcomm and Nvidia — emerged from a series of press conferences at the Consumer Electronics Show in Las Vegas to become leaders in locking the brains of self-driving cars for the next decade.
These collaborations involve the integration of dozens of older, slower chips into more powerful centralized computers. But to win the partnership, chip companies have to agree to give automakers control over key parts of the technology.
Reuters has previously reported that Apple plans to launch an electric car. The iPhone maker aims to achieve fully autonomous driving as early as 2025.
The stakes are high for automakers facing Apple and Tesla. In addition to electrifying models, automakers are essentially designing central computers with increasing self-driving capabilities.
That means that long after the vehicle is sold from dealerships, automakers have a great chance of making money from the car's software and services, but only if they have customer relationships and data like Tesla and Apple.
Danny Shapiro, vice president of automotive business at Nvidia, a high-performance chipmaker, said, "Automakers that are no longer pioneers are finally realizing that if they don't change their thinking, they will be left behind forever." ”
At this year's CES show, Nvidia announced that it will provide several Chinese electric vehicle startups with the electronic brains of the cars of the future, while also working with other automakers, including Mercedes-Benz, Hyundai, Volvo and Audi.
Electric vehicle startups working with Nvidia Image source | NVIDIA's official website
Shapiro said control of technology and data is a sensitive area between automakers and tech companies. "Whether it is a controlled plan or a customized plan, whose hands should the data be in?"
The answer is complex because achieving autonomous driving requires a lot of technology.
These include computer vision algorithms that help cameras identify pedestrians, high-precision maps of the world's roads that are expanding, and "driving strategy" software for making millisecond-level decisions about a car's behavior when it comes to unexpected situations.
For chipmakers, this means they need to have every aspect of the technology ready, but at the same time be willing to let customers pick and choose.
Qualcomm, for example, bought Veoneer last year for $4.5 billion to perfect all the software needed for its self-driving chips. But after announcing at this year's CES show that it won the first large-scale self-driving chip supply contract with GM, these software assets are not included, because GM will develop its own software.
"Our software stacks are all developed in-house, so we won't use their parts," said Jason Ditman, principal engineer at GM's upcoming "Ultra Cruise" off-the-beaten-path product.
Autonomous driving platform developed by GM and Qualcomm Photo credit | GM's official website
But for other automakers, Qualcomm needs to have all parts of its self-driving system ready, said Nakul Duggal, senior vice president and general manager of automotive at chip companies.
"Different automakers find themselves at different stages of preparation," he said, "and the key for automakers is that they have to be able to build relationships with the customers they're trying to acquire." ”
Similar changes have taken place in mobileye's relationship with Ford, which deepened last week. In the past, Mobileye packaged its vision sensors, chips, and autonomous driving software into an integrated solution for partners. Now, Mobileye will begin to decouple some of the features of its packaging scheme and allow Ford to build its own technology on top of those features.
"We give All the output to Ford and they're going to run their own algorithms on top of our output," Mobileye CEO Amnon Shashua told Reuters.
Image credit| Mobileye
Chip companies have little choice and can only become more flexible because they also have to face important competitors from their peers.
Phil Amsrud, senior principal analyst at IHS Markit, said automakers used to rely on only three major suppliers – Infineon, Renesas and NXP – when it came to controlling simpler semiconductors like engines.
But the market for chip companies that provide high-performance computing to automakers is relatively crowded, and companies such as Huawei Technologies Co., Ltd. and computer vision company Amba Semiconductor have also entered the automotive industry.
"We're at a stage where we have too many suppliers," Armsrud said. "If you look at the automotive industry from a traditional perspective, there will be a few suppliers left."
*This article is compiled from Reuters by Stephen Nellis and Joseph White