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CES 2020 came to a close with the automotive industry looking at immediate and real-world use cases around an autonomous and on-demand connected lifestyle. Apart from DOT updating new AV guidelines at CES, the Frost & Sullivan team went into CES to understand how the automotive industry players, which have traditionally been cautious and slow adopters of technologies, are going to bring about a vast change in mindset. Though these concepts are being showcased by OEMs and suppliers, none of these players have disrupted the market like Elon Musk with Tesla. After all the production issues and criticism for technology implementation via OTA, the company is currently being valued at $80 billion, and we can expect it to become the Apple of the mobility industry.

As the Frost & Sullivan team clocked several miles to unearth how the industry perceives the evolution of the CASE/ACES world for the upcoming decade, the three most important themes we expect to shape the future of mobility are:

  • 5G – We believe 5G will propel innovations that will redefine consumer experiences and spearhead the digital transformation across the automotive industry. We have yet to imagine the true potential of this technology.
  • IoT – Is no longer Internet of Things, it is called Intelligence of Things. As more devices get connected and become intelligent, there will be an increasing need for the concept of platformization across key automotive domains. It is expected to increase partnerships among the auto ecosystem to deploy plug-and-play solutions to fulfill immediate requirements.
  • Human Digital Life – As we transition from silicon-on-chip to the vehicle-on-chip era, biometrics will become the central nervous system to create a unique customer connection. The goal will be to seamlessly customize all aspects of the customer’s mobility journey and digital lifestyle. Mercedes-Benz’s Vision AVTR concept is a good example of the human digital life.

Below are some key trends/learnings observed from the show where the above three themes will have a common thread:

  • Software-defined PlatformAD platforms using Next-generation SOC for Quicker Time-to-market Deployment

One of the key highlights of the show was Qualcomm’s Snapdragon Ride Platform, a more power-efficient platform for automakers to turn their vehicles into self-driving cars. The Snapdragon Ride Platform will be able to deploy L1 to L5 functions, i.e., right from L1/L2 active safety ADAS functions to fully autonomous driving for use cases such as urban driving, robo-taxis and robo-logistics. There is a clear competitor for NVIDIA, which recently announced its DRIVE AGX Orin, achieving 200 TOPS compared to Qualcomm’s claim of 700 TOPS. This dramatically raises the bar of the SOC game and it would be interesting to witness the vehicle performances running these SOCs side by side (expected around 2022/2023 timeframe).

Bertrandt made its first appearance at CES with the HARRI platform, a completely in-house-developed vehicle platform showcasing how data processing and intuitive software are key building blocks for digitization. There is a very clear indication that their goal would be to license this platform in conjunction with their decades of experience in engineering services. The simple conclusion to draw here is that it will be an interesting partner for any OEM, supplier or technology provider looking to enter the MaaS space. There was a similar licensing model for BEVs that was showcased by Bosch and Benteler.

As the industry traverses from a vehicle-centric to service-centric path, Frost & Sullivan analysis expects   OEMs will be forced to develop or license new digital platforms to prepare for the future of CASE convergence.

  • Digital Cockpits, Large and Wide Real Estate for Displays Continue to Hog the Dashboard

While the overall UX language was still touch, it was fascinating to see a display real estate showcase of sorts. Audi showcased display on demand, which was, in many ways, the coming together of two display layers (transparent OLED and an additional black layer that creates deeper black). Two layers are needed because current consumer-grade displays cannot display deep blacks. Display sections that are not required can remain transparent to provide a transparent and clear view of the road. It is partially embedded in the instrument panel and extends the entire width of the dashboard. The other interesting showcase was a 3D mixed-reality HUD display in partnership with Samsung, which tracks eye movement with a camera and projects the images in the direction of the eye without the need to refocus. Bosch showcased a similar 3D concept for the instrument cluster without the need for an eye-tracking camera. Byton’s 48-inch display continued to be the star in the display real estate space with content prioritization using steering controls. Though no different from the previous year’s showcase, new announcements were partnerships with ViacomCBS to stream video content and a developer program to create interactive content to improve customer experience. The primary goal is to deliver the M-Byte to the US market in2020. Chrysler showcased its Airflow Vision concept, where the focus will be more toward the quad screen IVI, even if exterior design philosophy will remain a concept; we expect the quad screen-based IVI could make a presence in its EV lineup.

We can expect to see these digital cockpit and real estate changes only across the premium lineup while, for the foreseeable future, volume segments will have a central display size of up to 10 inches with a probability of a completely digital IC as a key differentiator and probably some level of ECU consolidation.

  • City-based Public-Private Partnerships (PPP) continue to be the crown jewel on every mobility player’s agenda

The focus for OEMs like Toyota, Ford and Honda were clear with Toyota launching its real-size city lab at Mt. Fuji called WOVEN. Ford continues its efforts to become a mobility company using the Transport Mobility Cloud to help cities improve congestions. The Ann Arbor showcase was to simulate real-world opportunities to reduce traffic congestion and improve micro-mobility accessibility to create more open parking spots. We can also expect Ford’s Corktown Campus to be made smarter using a similar value proposition. Single-use cases such as traffic management was a focus for OEMs such as Honda, while other companies such as Bitsensing won an innovation award for integrating a radar and camera to achieve a similar use case. Mobileye’s REM-based vehicles are expected to unlock more actionable insights from the surrounding assets. These insights will help in preparing for use cases around city planning (intersection/traffic management, pedestrian traffic, shared service deployment zones, etc.) without focusing only on pure-play automotive-centric use cases.

As cities will not pay and are expected to barter data, access to cities through public-private partnerships will help fuse traffic information to orchestrate congestion-free usership and ownership business models. OEMs are expected to use this opportunity to deploy their shared mobility services within these cities to become the central gateway for mobility services. The win-win for cities here is that if these partnerships take off and get it right, the need to spend on newer infrastructure to compensate for congestion is negated while reducing accidents/incidents, which are very positive business outcomes.

  • Vehicle ArchitectureMoving toward a Zonal Architecture with Fewer Control Modules 

If there is one major trend that matters for the CASE world, it is moving toward high-performance central computing platforms. Due to the increasing data throughput in vehicles, complexity and cost, domain-controlled architecture and an Ethernet backbone will be important for the future of the vehicle architecture. This will result in the transformation of E/E architecture—from decentralized computation to centralized computation. However, this gradual consolidation of ECU will pass through an intermediary stage of domain-controlled architecture. Valens showcased its partnership through Aptiv’s Smart Vehicle Architecture (SVA), where the new platform will reduce the number of connections and individual devices in vehicles with a centralized architecture. The goal is to achieve redundancy while reducing costs. Visteon showcased its new generation of SmartCore, which is a production-ready cockpit domain controller. SmartCore will launch in 2020 on the new GAC’s EV platform, Aion LX, in partnership with Qualcomm and Tencent. JLR showcased the dual eSIM modems, where one standalone eSIM is used in the vehicle DCU for SOTA updates and the other eSIM is housed for running the advanced infotainment for in-vehicle entertainment and app purposes. 

Frost & Sullivan expects automakers to evaluate two approaches for consolidation of E/E architectures: centralizing data and decision-making into domain controllers and vehicle zone-based data and decision-making (e.g., Tesla has achieved zonal architecture in the vehicle’s frontal region).

  • On-demand Content and Customer IDCustomer Hook through Immersive Experience and Personalization

If there was one clear and unified message across the board at CES, this was it. OEMs supported by suppliers and component players are eyeing user experience as a key to customer satisfaction for brand differentiation. HARMAN makes an impact as it continues to differentiate with the IGNITE cloud platform, which is at the core for content delivery and newer services. The IGNITE Marketplace helps deliver personalized content through several third-party services while integrating the skillsets of several virtual assistants to deploy these services without any driver distraction. Audio marketplace is an on-demand infotainment feature from HARMAN’s portfolio that delivers personalized and experiential audio through OTA. Frost & Sullivan’s recently concluded Voice of the Customer study highlights that at least 45% to 50% of drivers in the US are very likely to use features on demand. Frost & Sullivan expects OEMs to have higher chances of bringing in service revenues through these transactional business models/paid services, which will support their overall value proposition and justification for technology investment.

Another idea that is expected to create an influence in the world of shared mobility is HARMAN’s multi-modal experience stack using the IGNITE platform and ultra-wideband technology. This stack will be able to instantly access personalized features and vehicle settings of a user by generating a unique token that is used for identification. This token, or customer ID, is expected to be a winning value proposition in the eyes of any OEM. Valeo showcased a similar and interesting concept called the Smart Cocoon 4.0, creating a personalized bubble zone. Frost & Sullivan expects this customer ID, also known as a sales platform, to be a game-changer for any OEM. This platform will deploy unique and personalized experiences for customers while creating the brand loyalty hook.

On the other hand, BMW and FCA are expected to be the first automakers to bring in on-demand content through Fire TV in their upcoming vehicles; this could be a major differentiator with respect to rear-seat entertainment. Apart from its trademark HD Radio, Xperi showcased how it delivers DTS connected radio as a direct-from-source radio metadata solution, providing rich content with minimal data consumption.

  • Automated DrivingPractical Autonomy (Level 2+) Enabled through Driver Monitoring Systems (DMS)

It was a welcoming sign to see the deployment of L2+ system from the suppliers. Veoneer’s demo was a clear showstopper this year. In collaboration with a host of partners such as Seeing Machines, Affectiva, Phasya and Ericsson using the Zenuity platform built jointly with Volvo. Most of these L2+ systems will follow two different approaches: a pre-planned route from navigation or the most probable path (MPP). This system also facilitates driver-initiated lane changes.

On the other hand, ZF is concentrating on Level 2+ deployment called ZF coASSIST, which is the first step into the modular Level 2+ hardware and software suite using the Mobileye EyeQ technology. ZF is expected to integrate Asian OEMs with this system at a price point that is less than $1,000. Mobileye also announced a partnership with SAIC to use Mobileye’s REM mapping technology to map China for L2+ ADAS deployment, which is expected to lay the foundation for newer OEM partnerships in China. Comma.ai also showcased assisted driving technology; this is a pure plug-and-play system that can equip older vehicles with lane keep assist and adaptive cruise control.

Frost & Sullivan expects DMS to be a crucial component for L2+ deployments as this data will be used to interpret the state of driver’s attention to provide real-time feedback and for liability purposes. Non-compliant feedback from the DMS will trigger a safety-critical protocol that will pull over the car to the side of the road, preceded by an audible warning. There were several driver monitoring solutions from Bosch, Xperi and others on display, clearly outlining how L2+ implementations using driver monitoring are clear important market opportunities for the near future.

  • 5G and C-V2XProximity Scanning for Evasive Safety Measures

Just as in the mobile phone business, 5G was one of the biggest themes at CES this year for the auto industry, with a key announcement coming from BMW. BMW is expected to be the first OEM to deploy 5G-enabled TCUs in its iNEXT EV from 2021 with Samsung. Verizon and HERE will focus on V2P; V2V use cases include pedestrian safety and collision avoidance, ridesharing pick-up/drop-off and parcel delivery services. HARMAN also showcased pedestrian safety (V2P) solutions that help prevent incidents/accidents, enhanced with 5G-based C-V2X networks. Panasonic demoed its new CIRRUS, a scalable V2X platform for transportation ecosystems. Using cloud analytics or edge analytics in the event of cloud service disruption, this platform will be able to deliver DOTs and other control towers with actionable V2X data.

Frost & Sullivan expects new players to emerge in the 5G unlicensed spectrums, which will aid in the expansion of connected services to suburban and rural areas. C-V2X will be a key sensor input in the autonomous driving market while making more efficient use of transport and infrastructure networks.

  • Data OrchestrationControl Tower for Data Analytics/Maneuvering and Neutral Server for Value-added Services

Control Tower is one of the key ingredients for deploying smart infrastructure services; it becomes a solid backbone to deploy connected and autonomous solutions, especially in cities. Control Towers will help deploy, monitor, and gather live data from the entire environment. Veoneer showcased a comparable idea during its demo to monitor the vehicle in a mini smart city set up with a control tower that was 5G-enabled to navigate obstacles. Bosch also showcased the control tower concepts with a partial use case centered on managing in-store traffic. Combing a camera, cloud-based algorithm, and analytics provides retailers with the insights into customer buying patterns and activities within the store while protecting data privacy. Frost & Sullivan expects control towers to be a vital element when suppliers deploy infrastructure-as-a-service solutions for smart city projects.

HERE introduced neutral server capabilities to the HERE Marketplace to empower safe and secure third-party access to vehicle sensor data. Blockchain-based consent management secures car data and provides users with privacy. Daimler will be the first OEM to provide access to sensor data through the HERE neutral server. Otonomo also announced its latest OEM partnership with Mitsubishi Motors for their neutral server and anonymization engine that is expected to deploy several use cases around parking, HD maps, smart city, etc. We can look forward to interesting times when OEM-owned shared mobility initiatives begin using these partnerships to create value-added services for the consumer.

  • Amazon Hints at Bigger Ambitions Beyond Alexa While Microsoft is Transforming Mobility Experience through New Business Opportunities  

As an extension to CES 2019, Alexa continued its foray into devices with deeper integration into vehicle functions, which was one of the key attractions at the show, e.g., Lamborghini Huracan EVO and Rivian integration. Apart from being the booth that received the most footfalls in the North hall, Amazon showcased several uses cases highlighting its portfolio of services to support the digital transformation journey of a customer. AWS mitigates the challenges of creating new user experiences and longer time-to-market by offering tools that automakers, fleet services, telematics providers, software developers, and integrators can leverage. Key announcements ranged from retail, edge computing, data monetization, machine learning for HIL and SIL testing for autonomous vehicle development, etc.

Microsoft’s biggest play at CES was its MVCP platform that continued to forge several partnerships across the industry. Key scenarios such as predictive maintenance, improved in-car productivity, advanced navigation, using the virtual personal assistant, and a data marketplace leveraging Azure delivers personalized, convenient and multi-device experiences. Partnerships with Ericsson and LG’s webOS were intriguing, especially around their showcase on the automotive intelligent edge, which is able to accommodate any automotive workload that spans general compute to mission-critical. The other interesting partnership was with Bell for the AeroOS platform, highlighting the power of the Azure cloud to create connected fleet management for the air mobility network and seamlessly integrating it into the smart city infrastructure to make flying taxis an integral part of the mobility ecosystem.

Google dampened expectations of many with no particular demo on automotive use cases, while the Polestar 2 at Veoneer’s booth helped experience the expected Google Automotive Service (GAS) rendering. Amazon, Microsoft and Google will continue their emphasis on the automotive side of their business while establishing themselves as integral partners for the future of mobility.

  • In-car CommerceThe Evolution Continues with Ease of Payment and Voice Integration

We have seen the evolution of the in-vehicle marketplace from Gen 1 systems that lacked proactiveness and contextuality, to the Gen 2 systems that were showcased at CES 2019 and had much more intelligence and an intuitive commerce assistant. This year saw yet another evolution with Alexa’s foray into the marketplace with voice integration. The voice integration feature removes the need to type codes for authentication/validation at ExxonMobil gas stations or to use your card to pay. In partnership with Fiser and ExxonMobil, Alexa completes the process with “Alexa, pay for gas.” These voice-activated fuel purchases can be carried out by Alexa SDK integrated within the vehicle or via Alexa-enabled smartphones. Payments are expected to be processed via Amazon Pay, with payment information stored with the card on file with the OEM or with the Amazon account. Currently, multiple cards cannot be processed simultaneously.

TomTom also showcased its XEVO partnership, where XEVO’s SDK is integrated into Tom Tom’s navigation platform. The biggest advantage of this partnership in conjunction with Alexa is the ability to not just locate or identify but also reserve; the goal is to limit the number of steps. Sirius XM and Telenav (with their newly launched VIVD platform and SDK) have also made similar strides in integrating voice and navigation in their marketplace offering, the only difference being fewer use cases compared to their competitors. Connected Travel is also expected to launch its service this year with a Honda partnership.

Frost & Sullivan’s recent Voice of Customer study also indicated that use cases such as fueling/EV charging and restaurant reservations are of higher priority to customers. The entire marketplace concept is increasingly becoming a data monetization avenue that most OEMs are expected to offer.

  • Autonomous ShuttlesPurpose-built Vehicles Enabling a Gig Economy

Autonomous shuttle concepts are expected to fulfill the ephemeral needs of mobility. These ephemeral needs are expected to drive innovations in business models and policies, creating a gig-mobility (freelance mobility) environment. Use cases such as on-demand last-mile food delivery using gig workers (shared mobility, cargo bikes, e-scooters) and non-humans (e.g., robo pods, drones for high-rises) are examples of these autonomous applications.

Some of the relevant showcases were Mobileye to deploy robotaxi “VW Cedric” in TelAviv by 2022, with a few more projects in the lineup such as Daegu Metropolitan City in South Korea. LG, in partnership with Adient, showcased a noticeable concept based on its WebOS application, a self-driving connected pod showcasing a host of services from entertainment to payment options. Toyota showcased its e-Palette and micro Palette (AV delivery robot), which is expected to debut at the Tokyo Olympics this year. Bosch showcased their IoT shuttle highlighting how it can support both networked mobility services and on-demand mobility where as Rinspeed’s demoed their modular pod system where modular body-styles will be used for modular on-demand business  

Frost & Sullivan’s recent report, Future of Global Online Food Delivery Services Market, expects a combination of autonomous aerial and ground delivery methods to make the future of food delivery more efficient and cost-competitive, accounting for up to 2% of global orders by 2025. Delivery methods will involve third-party logistics providers and part-time delivery agents, especially during peak times to increase reach and capacity, giving rise to a gig economy.

Valeo showcased its “Droid” delivery shuttle with its Chinese partner Meitun (local food delivery leader). Continental also showcased its CUbE in partnership with Easy Mile, while Olli showcased its 2.0 version in partnership with Affectiva, enabling facial and mood tracking of its passengers.

The key objective for these market players is to arrive at a suitable business model based on the number of trips, passengers or even deliveries. The other business angle for this segment, where newer players can emerge, would be around fleet management and downstream maintenance/repair services.

  • PLATFORM-ization of the Infotainment ModuleSecure Plug-and-play Solutions

Though voice has been a key enabler for multi-modal HMI, Frost & Sullivan believes that infotainment platforms will be the key to deeper integration with the mobility ecosystem. Blackberry’s integration of Cylance into the QNX framework is a step toward enhancing the security of connected vehicles. Blackberry’s newest cybersecurity offering is part of its R&D Labs initiative that will enable both automakers and fleet operators to verify drivers and address any associated cyber risks.

Elektrobit’s (EB) partnership with Sony’s new EV concept Vision S is another showcase of how EB GUIDE’s plug-and-play HMI toolkit helps render a unique HMI design for immersive user experience.  EB GUIDE provides the necessary run time environment with required components from the GUI to NLU-based voice recognition technologies to augmented reality toolkits for HUDs.

Along similar lines, the LG and Luxoft partnership showcased how a plug-and-play platform can quickly deploy a production-ready digital cockpit, IVI, RSE and ride-hailing platform based on LG’s webOS Auto. We expect these plug-and-play platforms to be made available for automakers, fleet operators, and shared mobility services providers.

Last but not least, the Cerence drive platform was one of the key highlights for us at the show with multimodal upgrades for gaze detection, head tracking, and voice and gesture recognition. This purpose-built platform can be deployed for both personal and shared mobility users targeting safety and entertainment applications.

Besides the above key trends, it was very evident that the LiDAR manufacturers, after finalizing their respective optical and associated software stack, are moving into the business and execution phase through strategic partnerships. There were several other interesting showcases—Continental’s speaker-less technology, KARMA Automotive’s APMA partnerships with Leddartech and iNAGO, Arilou’s CAN bus compression and authentication, Yandex’s self-driving demo, Bose’s intuitive sound generation, Panasonic Automotive’s eCockpit solutions, HERE’s high-precision position for ADAS, automated driving, and road lane guidance system for Hyundai’s foray into becoming a transportation company with Uber to deploy flying taxis.

Conclusion: What Does All This Mean for the Auto Industry?

Traditionally, the auto industry has been a year or two late to react to what the consumer electronics (CE) industry has to offer, but certain CE industry trends have laid the foundation of what can be expected for the automotive industry. Here are some parallels:

TVs with 8K displays and phones with foldable screens are manifesting in the form of an intuitive HMI and immersive content and lounge experience for the automotive industry, e.g., BMW i Interaction EASE and Audi’s AI:ME, representing the “third living space.” The OnePlus Concept One smartphone where electric current is used to hide/display cameras,  AR/VR glasses are revealing themselves in the form of the Bosch Virtual Visor concept to prevent sun glare and information via HUDs and intuitive glasses for gig workers and construction/manufacturing industries.

Overall, the entire show in many ways was a concrete showcase of real-world use cases, but can we expect an Apple in the automotive world? Most claim it is Tesla. We are not just talking about mere brand loyalty numbers but an innovation culture and a roadmap that ticks boxes pertaining to future trends. The positive side of CES 2020 is that it is very heartening to see legacy brands analyze ways and means in which they can capture the Gen Z and Millennial mindset to make mobility an exciting value proposition while also extending mobility services beyond the urban lifestyle to suburban and rural areas.

This article was authored with support from the Frost & Sullivan CES team, and we will soon be publishing an exhaustive report capturing the key trends and showcases emerging from CES 2020.

About Niranjan Manohar

Niranjan ManoharNiranjan Manohar is Research Director in Connectivity and Automotive IoT at Frost & Sullivan. He has over 11 years of industry expertise, including more than 10 years of automotive market research and consulting experience.

About Niranjan Manohar

Niranjan Manohar

Niranjan Manohar is Research Director in Connectivity and Automotive IoT at Frost & Sullivan. He has over 11 years of industry expertise, including more than 10 years of automotive market research and consulting experience.

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