Automotive disruption with tech leadership and role of semiconductors in driving the future of mobility

The global $2.7 trillion automotive industry is at a tipping point. This is being driven by disruptive technologies like electrification, autonomy, and connectivity, fueled by the advancements in AI, 5G, Cloud and Edge.?

Semiconductors are the underlying technology powering digitalization of everything and its importance in the auto sector is set to grow manifold with the adoption of next-generation vehicles. Innovation is absolutely vital to this revolution and Intel with its strengths in the sector along with a comprehensive automotive strategy is set to accelerate the transformation.?

Semiconductors are the building blocks of future cars

It’s the dawn of a new ICE age – the Internal Computing Engine that is replacing the Internal Combustion Engine in automobiles – as this KPMG whitepaper puts it. And semiconductors are at the heart of this paradigm shift. Clearly, cars are becoming computers with tires.

IC TAM in the automotive semiconductor market is projected to grow to $85 billion in 2026 from $41 billion in 2021, driven by increased adoption of ADAS, electrification and connectivity etc. Moreover, Intel estimates that semiconductors will account for more than 20% of the total premium vehicle bill of materials by 2030 – a staggering 5X growth rate from 4% in 2019. As a result, it will drive the total addressable market for automotive chips to nearly $115 billion.

Key trends driving automotive transformation

• EV adoption set to grow exponentially

Electric vehicles are expected to capture nearly 50% of the global automotive market over the next decade. As technological innovations mitigate early concerns of range and on-road performance, more and more consumers and fleets are making the switch to EVs. Customers stand to benefit not only from an environmental but also from a cost perspective and both EVs and hybrids show advantages over internal combustion engine vehicles in terms of operating and maintenance costs. In addition, major ride-hailing companies such as Lyft and Uber have committed to shift to 100% EV fleets by 2030.

• Autonomous vehicles for a smarter, safer ride

You may think of self-driving cars when you hear the word “autonomous”, but autonomy comes in different levels, from the convenience of cruise control to the safety of advanced driver assistance systems that can reduce road traffic accidents and fatalities.

According to the Experience Per Mile (EPM) 2030 report, by 2030, 79% of new vehicles will be shipped globally with Level-2 autonomy or higher, against 45% of new vehicles in 2020.

Fully autonomous cars will accelerate mobility as a service, leading to reduced vehicle ownership and traffic congestion. Besides transporting people, autonomous vehicles have the potential to disrupt the logistics industry.

• Connectivity to drive vehicle-to-everything communication and enable XaaS

According to Boston Consulting Group, connected vehicles will account for 100% of the market by 2035 . In the near term, the market for connected cars is projected to soar to $217 billion by 2027 from $42 billion in 2019. Auto manufacturers are leveraging the combined advantage of hardware to software across AI, 5G to lead this transformation and the cars of the future will operate like smartphones, transforming the mobility experience to enable much more than getting from point A to B.

Cars are turning into computers on wheels with the advancement in silicon, compute, storage and can enable many software services. A connected vehicle can not only communicate with other vehicles and infrastructure, but also offer the passengers a host of online services such as Wi-Fi, cloud, media, entertainment, etc.

AI, 5G, edge computing convergence redefines next-gen vehicles

The connected vehicle of the future will see a convergence of several technologies. An average car today has 100+ engine control units and edge computing is behind many of the functions from navigation to cruise control and infotainment. Autonomous vehicles can generate up to 40 terabytes of data an hour from cameras, radar and sensors, all of which needs to be processed on the edge. This requires massive computing power for cars and is driving the core of computation from the cloud to the edge of the network. Edge computing allows real-time data processing, enabling applications and devices with data-driven insights while on the move.

AI algorithms in autonomous vehicles can derive insights from this data to determine vehicle, traffic and road conditions and make real-time decisions. It can also enable a mesh network for distributed ledger technology like blockchain to manage, store and transfer digital records like vehicle details, warranties, wear and tear, mileage, loans, parts and service info for automobiles.

With the coming of 5G, edge applications in automobiles is only set to increase. Autonomous vehicles could be the killer application for 5G. It’s estimated to drive 40X increase in wireless traffic. With improved reliability, 5G can support more devices and sensors providing real-time insights. 5G’s low latency and high bandwidth will pave the way for a hyper-connected network, where connected vehicles can share data with one another and improve the autonomous journey for all. This will enable car makers to create stronger connections with customers than ever before with improved road safety - `vehicle to everything’ communication, reduced emission, while delivering enhanced driving experience through entertainment apps, music streaming or audio book services, and additional features like remote diagnostics, predictive maintenance and online service scheduling.

Deeper investments in R&D can catalyze value creation

Innovation is going to be the lifeline of this transformation. It requires deeper and sustained R&D investments across the spectrum of automotive ecosystem including semiconductor building blocks, silicon IPs, battery technologies, EV charging, and vehicle manufacturing to innovate and advance the momentum.

The automotive industry is responding to changing consumer demand and legislation. It’s a race to put electric, autonomous and connected vehicles on the road, driven by innovations in hardware, software and IPs. BDO research shows the top 20 manufacturers have collectively invested US$467bn in R&D over the past five years as they race to develop EVs and meet carbon targets.

Innovation in battery technologies, including Lithium production, recycling, and exploration of alternative, and development of fast-charging infrastructure are important factors for the success of EVs.?Accelerating AI and connectivity technologies will help deliver the computers-on-wheels that autonomous and connected vehicles promise to be.

Intel and Intel Foundry Services to lead this transformation along with customers and partners

Intel’s drive towards automotive transformation is racing up with significant traction around technology advancement, strategic collaborations and new initiatives. For example, Intel Foundry Services Accelerator?has been enabling automotive chip designers transition to more advanced process technologies by offering both custom and industry-standard intellectual property, as part of a larger initiative.?

In addition, we offer an expanding range of automotive grade products, including FPGAs and SoCs to enable flexibility, low latency, high performance-per-watt, functional safety, and security advantages for ADAS and AD applications. Our products can also enable applications such as gesture recognition, driver monitoring systems, and blind spot detection, allowing continued innovation in in-vehicle experience.

?With a holistic automotive strategy that combines Intel’s strengths and leadership in compute, storage, connectivity & AI solutions, along with expanding foundry footprint that’s underpinned by customer-first approach, the company is well poised to usher in the auto revolution. These would entail leadership and contributions across the auto semiconductor value chain integrating our foundry??offerings??such??as??packaging, IP, custom??SoC/ASIC solutions, design??services, and technology platforms. With these, our goal is to enable our customers and OEMs with best-in- class technologies and building blocks to lead the rapidly evolving automotive paradigm.??