In the ever-evolving landscape of the auto industry, established automakers are facing a challenge in keeping up with the digital features offered by their newer rivals such as Tesla and BYD. At the CES technology show in Las Vegas, industry executives and analysts discussed the growing importance of artificial intelligence (AI) in cars and the need for “software-defined vehicles.”
While newly emerged companies like Tesla introduced software upgrades over-the-air more than a decade ago, traditional automakers are still trying to catch up. The shift towards software-dominated vehicles presents numerous challenges, as cars require higher standards of durability and safety compared to smartphones. Additionally, AI systems like ChatGPT are error-prone and rapidly evolving, making it difficult for automakers to keep up with traditional product cycles.
Recognizing the need to adapt, Mercedes-Benz has launched a “beta program” to test the effectiveness of ChatGPT technology in improving dialogue between drivers and infotainment systems. This move signifies a shift in the automaker’s approach, as they explore the benefits of integrating large language models into their vehicles.
However, the transition to software-driven cars involves more than just testing new technologies. Automakers like Mercedes will need to develop and implement software at a much faster rate than their typical product cycles. This requires restructuring their IT infrastructure, manufacturing lines, and dealership processes to accommodate over-the-air updates and quicker software releases.
Efforts by established automakers to match software capabilities have been costly and not always successful. General Motors recently halted sales of its Chevrolet Blazer EV due to software-related glitches, leaving customers awaiting a fix. In contrast, Tesla’s ability to deliver updates over-the-air has proven to be an advantage.
To overcome these challenges, automakers like Volkswagen and Honda are exploring partnerships with technology companies to expedite the development of AI-driven features. Volkswagen has partnered with Cerence to incorporate ChatGPT into its vehicles, while Honda has formed a joint venture with Sony to combine their respective expertise in engineering, vehicle production, software, and gaming to create new EVs.
Despite the ongoing efforts to integrate AI-driven features into cars, automakers face another obstacle: convincing consumers to pay for these software-powered enhancements. Only a quarter of consumers surveyed by Deloitte expressed willingness to pay extra for such features. This leaves automakers with a limited window of opportunity before these functionalities become standard and no longer command a premium.
In conclusion, while traditional automakers work towards incorporating AI-driven features into their vehicles, they must overcome the challenges of accelerating software development, ensuring durability and safety, and convincing consumers of the value of these enhancements. The future of the auto industry lies in mastering the intersection of software and mobility, and only those who can adapt will thrive in this rapidly evolving landscape.