With estimates that the number of vehicles in the world has topped 1 billion, there is enormous potential for automotive electronics[1]. Developments in fuel efficiency, safety, and connectivity are a few factors driving auto manufacturers into the embedded marketplace, as they look to leverage hardware and software to improve subsystems ranging from powertrain, electric suspension, and braking to security, In-Vehicle Infotainment (IVI), and Advanced Driver Assistance Systems (ADAS). Reflecting these trends, Ben Scott, Analyst in the Automotive division of IHS Global Research headquartered in Englewood, CO (www.ihs.com), predicts modest growth in the overall automotive electronics market between 2014 and 2018, forecasting a Compound Annual Growth Rate (CAGR) of 4.3 percent from a base of $215.6 billion (Figure1).

IVI and ADAS systems have garnered particular interest from industry of late, as they resonate with safety, comfort, and convenience themes growing out of the consumer space. IVI systems are projected to mature at a 4.6 percent clip from 2014 to 2018 prompted by increased demand for in-car connectivity and large color displays, while features such as park assist in both luxury and high-volume vehicles will drive 14.9 percent growth in ADAS systems over the same period (Figure 2). However, as the auto industry integrates more commercial-grade technology into vehicle designs, it will also have to contend with standard mass-market issues like consumer education and cost. Coupled with the lifecycle disparities between consumer and automotive technology, these factors will converge to shape the development of the ADAS and IVI market segments.

“Two major factors are influencing the ADAS market segment in similar and complementary ways,” says Jeremy Carlson, Senior Analyst, ADAS, IHS Automotive. “First, innovation in technology is occurring at a fast pace – faster than automotive product cycles – and more functionality is allowing both volume and premium segments to deploy systems and compete on new technological fronts. Second, proactive regulation in the form of New Car Assessment Programme (NCAP) incentives is helping to push technology down market and into wider circulation as both optional and standard equipment.

“Cost will continue to be an important part of the overall equation and will help keep many ADAS as optional equipment, to be installed at the request of the consumer,” Carlson continues. “As a result, consumer education will be critical to the success of these technologies. However, between an initial lack of awareness and frequently insufficient understanding of how these systems operate and when they can or cannot be beneficial, consumers may not yet be making a fully informed decision. That is further complicated by how quickly these technologies evolve and nuances in operation, not only between vehicle brands but also vehicle models.”

“In terms of ‘infotainment’ – features such as apps, Internet radio, and the like – demand is very much being driven by the end consumer as they want to continue their ‘smartphone experience’ in the car,” says Jack Bergquist, Senior Analyst, Infotainment, IHS Automotive. “However, the automotive industry is having to innovate a lot in order to create new interfaces and Human-Machine Interface (HMI) designs, as well as trying to find ways to help negate the two-to-three year design cycles for an automotive infotainment system versus the six-month cycles for smartphones. [A] major challenge is the demand from OEMs to try and keep pace with the consumer device industry, despite the large disparity in lead times between the two industries. This is leading to Tier 1 hardware and software suppliers having to become more innovative in methods to keep systems ‘fresh’ over the vehicles’ sales cycles. This is being aided by over-the-air updates, allowing new features, look and feel, and apps to be added, and also through the ability to upgrade the hardware at the factory over the sales cycle of the vehicle.”

Software enhances upgradability, emerges as differentiator

As car manufacturers look to keep pace with the consumer device industry, software technology is taking a more principal role within vehicular subsystems. In conjunction with the desire to reduce hardware within automobiles, remote software updates enable older model years to be equipped with the same functionality as newly released vehicles, Bergquist explains.

“Software is likely the battleground of the future when it comes to IVI, as this will be key to keeping systems up to date after the vehicle has left the showroom,” Bergquist says. “Also, in terms of adding new apps, features, and functionality, this will all be done over-the-air through software updates.”

In addition to realizing flexibility gains over hardware components, vendors are implementing software technology to meet complex design requirements, regardless of whether the system has an impact on user experience or not. As a result, the proliferation of software throughout automotive subsystems has made it a key capabilities area for many vendors, Carlson says.

“While hardware continues to evolve and improve, software has become ever more important as the systems themselves become more complex and rely on more sources of information to advise the driver or control the vehicle directly,” says Carlson. “Software is becoming an area of expertise for some suppliers and will be a key piece of technology and a differentiator in the coming years, not only as an important component in automated driving applications. Whether the nuances or the role of software is visible or important to the consumer, however, is another question.”

Legislation, regulation roadmap the future of ADAS and IVI

Although in-vehicle electronics are making a significant impact on the automotive industry, the nature of automobiles will eventually subject these technologies to regulation in terms of implementation, functionality, and usage. Over the long term this will affect the ADAS and IVI sectors across vehicle classes and in both established and emerging markets, and could play a role in how the technology behind these subsystems is allowed to advance over time.

“Legislation could pose a hindrance to growth, especially around some of the more advanced – and potentially distracting – connected features,” Bergquist suggests. “Guidelines have already been drawn up by the National Highway Traffic Safety Administration (NHTSA) in the U.S., and the EU has created a group to look at guidelines for ‘safe apps in the car.’ The industry is working very hard to minimize the distraction posed by IVI systems, however, it is acutely aware that only a few high-profile accidents attributed to distraction from an IVI system could cause formal legislation to be fast tracked.”

“Collision warning, avoidance, and mitigation systems will play an important role in [ADAS] growth as it is a class of application that is seeing the most interest from regulators – primarily in NCAP programs in Europe as well as in the USA, Japan, and other automotive markets – and can address one of the more common and perilous accident types,” says Carlson. “The role of regulation will grow in importance over time, but regulators must strike a delicate balance between industry and society, and so are often as cautious as they are proactive. Inclusion in NCAP programs is a great starting point and we’ll see more in that area, helping to incentivize wider availability and consumer awareness and eventually turning the discussion towards mandates over the long term. Before that, however, we’ll see the continued evolution of ADAS on the road to semi- and highly-automated driving, and the long-term impact of that evolution has the potential to really change the industry in some very significant ways.”

IHS Automotive

automotive.ihs.com

[email protected]

References:

1. “Number Of Cars Worldwide Surpasses 1 Billion; Can The World Handle This Many Wheels?” www.huffingtonpost.ca/2011/08/23/car-population_n_934291.html