GM Dropping Apple Carplay and Android Auto – Tesla-like move signals new ambitions

GM recently made headlines after they made the announcement that all new MY24 models will drop Apple Carplay and Android Auto except for select ones such as 2024 Cadillac Lyriq, Hummer EV Truck, Chevrolet Silverado, Bolt EV and EUV that will retain Android Auto. The move has been met with polarized reactions from the industry as most of these two projection modes are highly available across models and have become basic expectation from car buyers. Currently Tesla is the most penetrated brand who from the start did not offer Carplay and Android Auto and over the years haven’t had any significant backlash from owners because of this.

In my view, there are two reasons GM is trying to shift away from the projection solutions.

a)??????Transition to EV’s – if you don’t want your EV owner to download several apps to search and pay for charging and offer convenience the best solution is what Tesla did – offer a connected IVI on all its models and trims. While Tesla does charge a $9.99 subscription fee to get access to additional services, most customers end up taking it for added convenience. ?GM is making a big push on EVs and thus might have seen this as the right opportunity to pivot to its in-car system.

b)?????GAS and Ultifi – GM adopting Google Automotive services (Google maps, Google Assistant, play store possibly? and music) is well known in the industry. And GM will soon launch its homegrown Linux-based SW platform Ultifi which will allow it to finally do what Tesla has been doing for over 10 years in the industry – regular OTA, new features, app stores, etc. GM wants to fully monetize these investments and if you offer customers a choice of projection Vs. In-car IVI experience, there are high chances of dropout. Tesla in its annual reports call out a staggering almost 15 percent of its revenues in the next few years coming from software and this is where GM wants to head. With ambitious goals to double revenues by 2030 and increase revenue per car, GM wants to risk it with its new Google and Ultifi-based system.

c)??????One of things I remember from my past is that as wireless Carplay rolled out initially it faced a lot of issues from users and in the 2020 JD Power IQS survey in fact was highlighted as a top issue in the IVI domain. This could be a reason as ?well for GM to time the move to its in-car system right away.

While this effort is interesting, there are also risks associated with this move. Below are a few observations related to this.

·????????Car buyers have come to expect Carplay and Android Auto even in the basic trims of entry level models. And OEMs are to blame here because most of them have always offered projection mode options even in trims where they include IVI system with a 6–12-month trial for connected navigation and location-based services. Given that IVI systems have only started getting better recently in terms of the user experience and freshness, most customers just plug in their phone and continue their life and they can’t be blamed for this behavior. One advantage with the GM move is they are trying to break this habit with a familiar UX like Android. How much exasperation this will cause iPhone users is left to be seen.

·????????Commercially this must work out for new buyers. As new buyers transition to EVs which is already a challenge, OEMs also need to think like Tesla and Rivian with its new IVI systems. They can’t play the old game of monetizing IVI as a one-time option fee system that paid rich dividends to them over the years given the margin. For new buyers to enjoy the in-car experience, they need easier access and availability. Tesla buyers swear by their in-vehicle system and see continuous improvement in that all the time. This is the experience GM should aim for along with regular almost monthly OTA updates adding improvements and new features.

·????????How the Ultifi platform plays with GAS and how the app store there will add value to new owners remains to be seen. In Tesla’s case everything including the navigation/maps experience and the other applications all are integrated by Tesla and even though multiple components (maps, nav engine, services) are coming from different players, the resulting user experience is integrated by Tesla. How a GAS system will work with GM’s home-grown SW and how seamless and useful the end experience is for users remains to be seen.

Overall, this is still a very interesting effort and ultimately in the long run the right move to support owners’ transition to EVs. Me and my team at #marketsandmarkets are working on a study covering a variety of OEMs and their strategies and approach to #softwaredefinedvehicles . Along with the OEM analysis, we are also supplementing that with powerful voice of customer analysis across key regional markets to capture what customers/owners want from an SDV. Reach out to me to know more or how to participate in the study.?