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Software Defined Architectures: The Burgeoning Business Model

Executive Summary

Next-generation E/E architectures will create new business models for automakers and suppliers. But a Wards Intelligence survey shows few see themselves as pacesetters, and there’s some uncertainty about where the best monetization opportunities are. The massive change in operations, and the associated costs, will put constraints on the timeframe and depth of the changes in infrastructure and vehicle architectures that OEMs will be able to address.

Three key elements are changing the automotive industry, driving it toward a new mobility era, a survey by Wards Intelligence shows:

  • New business models and profit pools.
  • Hardware revolution and centralization.
  • Software-defined vehicles driven by data.

In this first article of a series of three, we will look at the impact the software-defined vehicle will have on the industry’s business model, supply chain and operating processes. (Complete survey results can be downloaded via the link at the top of this article.)

Without a doubt, the automotive industry in moving into a new and disruptive mobility era encompassing a much broader, interconnected ecosystem that is continually creating and sharing huge amounts of valuable data across domains.

The metamorphosis to new mindsets and strategies and the growing need for new competences in software and data, together with the urgency to contain development costs, are impacting each OEM’s operating processes and business models, as well as introducing opportunities to tap into alternative profit pools.

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