From car manufacturer to software company - how the automotive industry will make the transition

With intelligent and highly automated cars in the product portfolio, car manufacturers can no longer 'just' be experts in mechanical engineering, aerodynamics and road safety - they must also have expertise in software development. Players that have historically emphasised mechanical engineering will now incorporate both advanced and reliable digital systems into their cars.

"The software in a car has to be much more complex than the software in a plane or a boat, because the air and the sea as traffic environments do not contain as many other road users and objects that can be run over," says Peter Janevik, CEO of RISE's AstaZero test facility, and continues:

"Cars already contain a lot of advanced functionality in the form of emission control, steering and stabilisation systems, and it is estimated that this will increase by a factor of ten as vehicles become automated."

Designing with software in mind

When digitalisation began in the automotive industry, manufacturers opted to build lots of small computers into cars because it was the most cost-effective approach. Subcontractors programmed the computers for individual tasks, such as displaying speed or controlling an ABS system. Now the trend is towards centralised software, one computer that does it all. The result? More complexity.

This trend will require carmakers to restructure their organisations - at least the departments that will be working with the new technology. In addition, all design must be done with the software in mind. In the past, manufacturers could test a carburettor and an engine separately and then assemble them into a fully functional vehicle.

"Today, almost every function in a car needs software to work. And if the software doesn't work, you can't start testing the car. It's like taking the brain out of a person, nothing works. To get around this problem, you have to build a car in such a way that you can test it early on. You may not need the software to be completely ready, but it needs to work to the point where you can do tests," says Peter Janevik.

New business models and a tough race

It is the software-driven functions and digital systems that make the modern car valuable. So it is reasonable to expect that some manufacturers will try to move to new business models, such as subscriptions, and charge for the continuous improvement of the car's features, says Peter Janevik. Tesla has done this and charges around SEK 1,000 per month to unlock all the car's features.

"Another interesting thing to watch in the future is whether carmakers choose to develop the self-driving technology themselves or buy the service from someone else. My prediction is that there will be a few big players with the biggest market share, and then a bunch of small players at the back. Many will not succeed. Is it then worthwhile for manufacturers to enter this race?", says Peter Janevik.

Few carmakers have the capacity to do the amount of advanced testing that highly automated vehicles require. It's not enough for the software to work - the connected car must also be safe to drive in traffic. With this in mind, AstaZero, the world's first full-scale independent test environment for future road safety, was built. RISE is also contributing knowledge on everything from machine learning technology to EMC and cybersecurity, which are also relevant issues in the development of tomorrow's vehicles.

"A major advantage is that many of the skills that are not part of the vehicle manufacturers' core competencies are available at RISE," says Peter Janevik. With our expertise, we can act as an extension of their development departments. Together with our testing infrastructure, this means that we can help speed up the development of new products and technologies and bring them to market more quickly.