OEMs Are Moving to Outsourcing Their Connected Car Platforms, but Are Platform Providers Prepared for the Opportunity?

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By Maite Bezerra | 4Q 2019 | IN-5674


OEMs Are Susceptible to External Expertise


With the competitive advantages in the automotive industry shifting from hardware to software-centric offerings, most—if not all—Original Equipment Manufacturers (OEMs) are investing in connectivity. They mostly started by investing on in-house solutions as a means of maintaining their traditional value chain dominance. However, with their connected car platforms currently in their third or fourth generations, OEMs are coming to the realization that their in-house solutions are not flexible enough to deal with the increasing demand for big data analytics and Artificial Intelligence (AI) projects. We are now moving toward a new generation of far more advanced connected vehicles that require sophisticated technologies. As upgrading their own solutions would be costly and time-intensive, a few OEMs, such as Daimler and General Motors (GM), have stepped down their in-house solutions. ABI Research predicts that a wider number of OEMs will be prone to using external expertise, and the question that arises is whether or not platform vendors are ready to take advantage of…

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