Image source@Visual China
Text | Titanium Capital Research Institute
With the transformation of the automobile industry from the era of traditional fuel vehicles to the era of intelligent vehicles, the automotive cockpit industry under the wave of intelligence is also undergoing technological changes, from providing basic information to a multi-functional space integrating entertainment, safety and comfort, the automotive cockpit is moving towards the era of intelligence.
What are the investment opportunities for the future development trend of intelligent cockpits? Recently, Titanium Capital invited Yang Tao, general manager of Jundi China's automotive product division, to share the theme of "the development status and future trend of intelligent cockpits". Yang is always the general manager of J.D. Power's automotive products division in China. Jundi has leading consumer insights in China's automotive industry research and is known for its "independence and impartiality". He has 20 years of experience in automotive market research and consulting, and is an expert judge of the jury of the "China Model Intelligent Cockpit of the Year" award of the Huayu Awards. The moderator of this sharing is Mr. Wu Kai, Managing Director of Titanium Capital, who is responsible for the financing and mergers and acquisitions of smart cars and specialized and special new enterprises, and is an important promoter of China's IT service industry and cloud computing industry. The following is a transcript of the sharing:
Build a competitive advantage for automotive brands around the world
J.D. Power's core work is to conduct consumer insights, and is committed to becoming a link and bridge between consumers and car companies. Every year, we conduct a number of benchmarking studies and award corresponding awards, including product strength, retail services and brand-related awards, which have long been hailed as the Oscars of the automotive industry. At the same time, we also provide data and consulting services.
The company's goal is to build a VOC system to help car companies continuously improve and improve their products and services based on the real experience of consumers. From the beginning of planning, all the way to production, sales, and even the purchase of trade-in and used cars, we are committed to improving overall customer satisfaction. The improvement loop is achieved through three steps: industry research benchmarking, customized study diagnostics, and consulting services. Each year, we provide more than a dozen joint research reports covering products, services, and brands. After benchmarking, a customized study diagnosis is used to drill down into the needs of specific users. Benchmarking and diagnostics are based on consumer insights that are then turned into opportunities for improvement. Therefore, the significance of the third step of consulting is to maintain the competitiveness of car companies through the improvement of product strength and service processes.
Intelligence is the new luxury of Chinese automobiles
The development of intelligence is coming with the emergence of new energy vehicles, and electrification is the first half of the automobile revolution. As of November this year, the penetration rate of new energy vehicles in the new car market in 2023 is expected to exceed 35%, and in some first-tier cities, the penetration rate of new energy vehicles has even exceeded 50% in recent months. Under this general trend, it has gradually entered the second half of the automotive revolution. In J.D. Power's 2023 prospect study, we found that among consumers who are interested in buying a car in the next six months, the weight of intelligent experience in car purchase decisions has increased year by year, from 12% last year to 14% this year. Correspondingly, the weight of price in the car buying process has decreased slightly. Secondly, whether it is a first-time car buyer or a replacement consumer, its population structure has also changed, and the post-90s generation has become the main group and is about to transition to the post-95 generation. This group of people has high expectations for intelligent vehicles and is willing to pay extra for intelligent experiences.
Exploration and precipitation in the field of intelligence
J.D. Power's exploration in the field of intelligence has also been using the closed loop of benchmarking, diagnosis and improvement. Next, I will share with you two of them, one is the advanced technology allocation index research called TXI, that is, the research on the intelligent situation of the automotive industry in the Chinese market, including fuel vehicles and new energy vehicles. In addition, because the development of intelligent cockpit in China is still in the diversified stage, we hope to find innovative and distinctive models in the field of intelligent cockpit every year, which will set an example for the future development of the industry and the intelligent process.
Mature research system, continuous accumulation of insights
First of all, let's talk about TXI - the brand's technology innovation index. TXI is a research project on the advanced technology configuration of intelligent driving and intelligent cockpit. The advanced nature is a dynamic change, and we will dynamically adjust this configuration list every year, involving about 40 items. The focus of the TXI Index is mainly on two aspects, namely functional performance and market depth. The market depth is simply the penetration rate of technology configuration, and the functional performance is divided into two parts, the quality feedback of consumers occupies 40% of the weight, which includes whether there are complaints such as failures, and the other 60% is the overall experience of users, including seven aspects such as ease of use, effectiveness, practicality and beautiful interface. These two are added together to form our Functional Performance Index, which ultimately results in the integrated TXI Innovation Index indicator.
If we classify the car companies in the Chinese market according to mainstream international, traditional independent, independent innovation, and independent new innovation, such as Deep Blue, Aion, etc., which are divided into independent new forces, and Wei Xiaoli and other independent new forces, we can see that in regions with high market penetration and functional performance index, the proportion of independent new forces and independent new ventures is the highest. The intelligent performance of Chinese brands is catching up with and surpassing traditional international brands, which is why many European and American car companies are looking at the intelligent performance of Chinese car companies today.
The market introduction and penetration process of advanced technology configuration
There are several key points for any innovative technology to be accepted by the market and consumers, and here we use the model of "innovation diffusion theory" to analyze. Taking the car voice assistant as an example, the penetration rate in 21 years is about 20%, and now it has exceeded 50%, crossing the boundary of the early majority and becoming the mainstream configuration of the market, and the same is true for online real-time navigation. This is also in line with today's mainstream consumers on a car's smart cabin technology level of the common way, if there is an intelligent voice assistant, can better recognize a variety of instructions, and can perform continuous voice operation, consumers will leave a good first impression of the car's intelligent level.
Expand the reach of intelligent cockpits
Nowadays, the development of intelligent cockpits in China is indeed full of flowers, and the development of the industry needs to set an example and give forward-looking guidance. Therefore, last year, we cooperated with Tongji University to hold the Huayu Award, hoping to form a cross-border expert group of industry, academia and research, and measure the objective data of vehicles to complete intelligence-related tasks through the subjective data of consumers and the use of equipment and instruments in the human-machine laboratory of Tongji University. Subjective and objective, coupled with the professional opinions of the expert jury, to evaluate the performance of the intelligent cockpit more comprehensively. In the end, we hope to release China's most distinctive intelligent cockpit model globally and lead the forward-looking development of the entire industry.
Let's share some insights from this year's Huayu Awards consumer reviews. Compared with last year, the intelligent cockpit has become more and more advanced, and more and more technical equipment has been installed in the car, but from the comprehensive evaluation of consumers, the score has decreased. This year's average score is 7.64, compared to 8.05 last year. Today's consumers are not satisfied with the simple configuration of science and technology, and consumers have put forward higher requirements for intelligent experience.
Future development trends
1. Driver interconnection creates a new ecology
One of the award-winning models of last year's Huayu Award, the Wenjie M5, is characterized by the seamless interconnection of the car machine and the mobile phone. This year, Lynk & Co 08 brought the Flyme system built by the Meizu team. It can be seen that the Lynk & Co 08's driver interconnection has been highly praised by consumers, with a score of 9.23.
Whether you see the vehicle as a mobile device or part of a digital ecosystem, the deep interconnection between the car and the mobile phone will create a new ecosystem. We will see more and more companies engaged in the mobile digital ecosystem entering the automotive industry, and this will certainly be the trend of the future.
2. The new technology of HUD expansion gives the cockpit a new height and width
More and more models are doing away with the traditional instrument cluster. The reason is that in addition to providing more information about the status of the vehicle, the AR-HUD can also provide real-life points of interest and real-time broadcast during navigation, which makes the driving experience even better. In addition, we have seen some models start using AR-HUD for video calls, and it is also possible to project images to the front of the vehicle to enjoy movies on a larger screen. This allows the use of the screen to be fully extended.
3. The flexibility of design brings a new direction to the cockpit layout
This year's award-winning ZEEKR X model showcased that the center console and passenger screen can slide against each other. This opens up a new possibility, in addition to stacking hardware, can we meet the user's experience needs through a relatively low-cost flexible design? This is also a very interesting direction to explore.
4. The co-pilot screen can not be a chicken rib but a finishing touch
One very interesting insight we found is that not all models with high consumer review scores come with a passenger screen. Judging from consumer feedback, the passenger screen is not a necessity. If you can provide a great user experience with a single central display, consumers will be equally satisfied. However, if the co-pilot screen is assembled, due to the entertainment function attributes of the co-pilot screen, consumers have certain requirements for the size and resolution of the screen, and it can be seen that 13 inches is a watershed in the consumer's experience of the co-pilot screen.
5. A breakthrough in the humanized experience of air conditioning and seats is just around the corner
Many models are now equipped with zero-gravity seats, and even the main and co-pilot are equipped with zero-gravity seats. The flexibility of the chair is changing more and more depending on the scenario. Air conditioning is no exception, and this year, more and more car companies are innovating in the field of in-car air conditioning, making temperature and wind direction adjustment more intelligent and comfortable, and at the same time making the cabin environment more pleasant and comfortable by integrating visual and auditory effects. Automotive air conditioning is actually a relatively traditional field, and it is indeed very difficult to do a good job, but we have also seen many gratifying breakthroughs.
6. AI large model helps voice interaction
This is probably one of the hottest topics of the year. It has become a trend for large models to get into the car, and we have found that large models do bring a smoother experience to voice interaction, and are more intelligent and understand you. In the future, it is believed that more and more consumers will soon be able to experience the convenience brought by large models in their own cars.
In the future, there may also be small disruptions in the industry, such as whether screens are still necessary, and many times, AIGC will be able to sift through all the information from a large database. In other words, AIGC's processing is like a black box for users. But as consumers, we only need results, like when we have a conversation with Chat GPT and ask it to help us with a task, we don't need to know how it works behind it. In this case, the advantages that the screen once had will no longer exist. Therefore, after AIGC is put on the car, it will definitely bring revolutionary impact and changes to the human-computer interaction mode of the cockpit.
As mentioned earlier, many innovative technologies and cutting-edge explorations are mainly concentrated in the hands of suppliers or Tier 1 suppliers, which is why we have started to cooperate with suppliers this year to make the future development of Huayu Awards and China's cockpit more input from the perspective of suppliers after two years of Huayu Award. Therefore, we have officially established the Huayu Award Intelligent Cockpit Forward-looking Alliance. Our expectation is to build a platform to connect OEMs and suppliers, and through this co-creation platform, we can commercialize forward-looking technologies in the hands of suppliers faster and better, establish better standards, and provide innovative technologies that consumers really expect.
interlocution
Q1: In the past two years, the basic technical architecture of the intelligent cockpit has undergone great changes year by year, and there seems to be similarities with the software architecture of mobile phones. Can you analyze the similarities and differences between the software technology architecture of the smart cockpit and the software technology architecture of the mobile phone?
A: There are similarities between the two, and the development of intelligent cockpits in China is mostly based on market demand. In the past few years, China has been at the forefront of the world in the development of mobile Internet and mobile phone ecology. In the cockpit of today's automobiles, the applications that have been put on the car and the applications that will be put on the car in the future are to a large extent integrated with the digital applications and life on the mobile phones and mobile terminals currently used. In this context, we will naturally see that the ecosystem architecture of mobile phones and in-vehicle systems is also very similar in general structure.
The difference is that a car is a durable good, while a mobile phone is a consumable. There are differences between the two in terms of industry requirements and standards, as well as hardware and operating systems. In addition, from the perspective of interaction or operation mode, when today's real autonomous driving has not yet been realized, for safety considerations, there must be very strict requirements for interaction methods, operation steps, response speed and effectiveness, which are not the same as the daily operation of mobile phones.
Q2: Since it is similar to the software and hardware architecture of mobile phones, is there a chance to replace it in the domestic smart cabin chip?
A: At this stage, there are already some domestic companies that occupy a lot of market share in the field of intelligent driving chips, such as Horizon. The smart cabin part, today's mainstream chip Qualcomm's 8155 is also transformed from consumer-grade mobile phone chips, if you purely look at the computing power performance on paper, the mobile phone chip is about 2~3 years ahead of the cockpit chip. From this point of view, we can have a rough judgment on the pattern of future cockpit chips from the current market share of consumer-grade mobile phone chips. Looking further, the integration of cockpit and cockpit is the trend of the future, and the integration of intelligent driving and intelligent cabin chips is the foundation, and the requirements for process capabilities will be higher, which will involve some factors in the global political and economic environment, so I will not expand much here. But at the same time, it is still necessary to see that in addition to the SoC chips of intelligent driving and intelligent cabins, there are other chips such as MCUs, power chips, sensor chips, etc., and with the continuous promotion of high-voltage platforms for new energy vehicles, there will be more new materials in the future, such as opportunities in silicon carbide, which are also huge opportunities for Chinese companies.
Q3: What models have been applied to the car, what is the penetration rate, and what hardware platforms can support the big model to get on the car?
A: Large models will cause disruptive changes not only in the automotive industry, but also in other industries. Now that each company's large models are working hard to get on the car, from the perspective of the three pillars of AI algorithms, computing power and calculation data, each company's algorithm may be different, and can be continuously corrected through deep learning Xi, so the difference is not big. As for computing power, it actually depends on financial resources, and some larger companies have a better foundation in computing power, such as Baidu, SenseTime, etc., which have accumulated a lot of experience and hardware in the field of AI. The last dimension of the large model is the calculation, that is, it is necessary to feed a large amount of data in the actual car use scenario of the user to the AI, so that the large model can better understand the application scenarios and forms of the car, so as to make more accurate judgments and recommendations.
As for the penetration rate, there are not many large models that have been put on the car and put on the market, but now the large model has become the scientific and technological standard for the new car planning of many car companies. Of course, in terms of hardware platform support, the use of 8295 on the vehicle side can provide better computing power support. The large model itself requires interconnection between the vehicle end and the cloud, and if it is all placed in the cloud without a network, the experience of the car side will also be affected, and a better balance needs to be achieved between the two.
Q4: For OEMs, there are two development paths for the operating system of the intelligent cockpit: self-development and cooperation. What is the current situation and what changes are likely to take place in the future?
A: At present, intelligent driving and intelligent cockpit are separated, so the two operating systems are also different. Intelligent driving requires a real-time operating system, while the intelligent cockpit can use a time-sharing operating system. In terms of smart cockpits, many systems are now actually developed based on Android. From this point of view, in terms of intelligent cockpits, car companies generally adopt a more open and cooperative approach to co-creation with suppliers. In the field of intelligent driving, capable car companies are more inclined to self-development, and this team needs to have full-link technical capabilities, covering the underlying chip docking, operating system, data application, adaptation, etc., including how to better integrate all sensor systems and self-driving software on the car in a solution that does not rely on high-definition maps, and even use crowdsourcing for mapping. In this regard, OEMs are reluctant to hand over this part entirely to their partners.
In addition, it is important to consider that industry insiders have often mentioned the closure and merger of Chinese auto brands in the next two years, that is, whether the Chinese auto market needs so many brands and models. If the industry consolidates, I believe that the future development direction of the intelligent cockpit operating system will also be affected.
Q5: What are the technical areas related to the smart cabin that are opportunities and worthwhile investments for start-ups?
A: First of all, it's about the advanced configuration and penetration rate of cars that have been launched in the Chinese market. As you can continue to refer to our TXI report, we actually see some configurations that have changed very quickly over the past few years, including digital keys, automatic parking, and congestion assist.
Secondly, from the perspective of technology trends, I think it is particularly suitable for start-ups. For example, display technology, including AR-HUD and AR glasses, will definitely bring richer and more novel applications in the car in the future, and improve more configuration rates. Thirdly, there is the interaction inside the vehicle, and the hot topics at the moment include smart surfaces and color-changing glass, which are all technology trends that will be rapidly applied to the car in the future. Finally, from the perspective of sensor technology, there will be more sensors for sensing the various behaviors of the driver or passenger. The suppliers behind these trends or companies related to the industrial chain should have more opportunities.
Titanium Capital Research Institute observes
With the continuous breakthrough of industry technology, consumers have higher expectations for intelligent cockpits. How to perfectly integrate intelligent technology with driving experience for various user use scenarios? What investment space exists in the middle? Titanium Capital will continue to pay attention to the cutting-edge technology of the automotive industry, build a communication bridge for platform partners, and explore the future development form, business model and industrial development trend of intelligent cockpit.