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Vehicle: V2X Inclusion in the Euro NCAP
As in previous iterations, this market data update takes into account a further expected delay to the inclusion of V2X testing protocols in safety ratings for new vehicles. Most vendors interviewed for this iteration of the market update anticipate that Euro NCAP will not reflect V2X applications in safety scores until 2029. There is a widespread belief that Euro NCAP places a premium on their technology neutrality, and does not want to play any role in driving adoption of either ITS-G5 for C-V2X. This certainly reflects Euro NCAPs historical role in driving safety standards, which has typically seen the agency driving adoption and setting standards for existing safety technologies, based on mature technologies, for which there is a healthy and competitive supply base to support Original Equipment Manufacturers (OEMs) in their deployments. Indeed, ABI Research expects that the successive delays to V2X inclusion in the Euro NCAP roadmap will persist until there is greater clarity from the automotive and telecommunication industries on the standards/protocols that will underpin V2X and cooperative mobility. Nevertheless, once the industry in Europe has coalesced around a common standard, ABI Research expects Euro NCAP to play an important role in proliferating what will then be an interoperable safety technology.
With respect to industry attitudes toward V2X standards in Europe, there is a widespread acknowledgement that the industry is trending toward a hybrid approach. Given the considerable installed base of 802.11p radios in market, it is expected that at least 10 MHz to 20 MHz of spectrum is likely to remain allocated to ITS-G5 for Day 1 applications, with NR-V2X (i.e. 3GPP releases 16 and onward) becoming the industry-preferred technology for Day 2 applications, and to support autonomous vehicle applications. This compromise approach reflects industry anticipation that the European Commission (EC) would look to preserve backward compatibility for Day 1 use cases in vehicles already equipped with ITS-G5, while also recognizing that NR-V2X capabilities are better aligned with Day 2 applications and autonomous vehicle use cases.
It is widely believed that VW, which has, so far, driven most of the 802.11p deployments in Europe, has also endorsed this approach (NR V2X for Day 2). As the OEM with the biggest stake in ITS-G5, VW’s endorsement of this approach is critical to its success in Europe. Therefore, ABI Research anticipates that NR-V2X deployments will begin in Europe from 2026, and will eventually become the technology of choice for Day 2 applications.
In conclusion, the industry in Europe is recalibrating in two critical ways. First of all, a compromise approach is now being pursued to give clarity on how different technologies will address different use cases. Second, the industry has become more realistic about the role that Euro NCAP will play, no longer expecting the safety ratings agency to create a V2X industry, instead accepting that the industry must adopt common technologies first.
V2X OBU Deployments in Europe
A commercial truck OEM and a private vehicle OEM have plans to deploy ITS-G5 in Europe in 2023. These are rumored to be Scania and Volvo. A third private vehicle OEM is rumored to be planning V2X deployment in 2024.
VW has equipped a number of models with V2X, including the Golf, ID.3, and ID.4. It should be noted that in spite of its general commitment for 802.11p technologies, Toyota has yet to follow VW’s lead in the European market, making V2X (outside of commercial vehicles) effectively a single-brand exclusive for the time being.
V2X Deployments in China
Presently, V2X is found only in China's low-volume premium vehicle lines and models. However, there are at least 25 OEMs in different stages of V2X production in China. Deployment is expected to grow exponentially in 2023 as carmakers prepare for the China NCAP 2025.
COVID-19 lockdowns slowed down deployments in 2022. Moreover, sources claim that an ongoing change in the regulation on how Global Navigation Satellite System (GNSS) positioning is reported is also slowing down deployments because to send safety messages, chipsets and encryption will have to be modified according to the new regulation, which is still in the draft stage. Therefore, carmakers are waiting for the publication of the new standard to launch vehicles featuring V2X. This, however, has not been confirmed. Overall, C-shift remains a controversial issue for V2X in the Chinese market, particularly for non-domestic OEMs that are more cautious concerning compliance, not wanting to jeopardize their position in the world’s largest market for new vehicle sales.
Critically, this ongoing confusion over C-shift is expected to impact the ambitions set out in the Intelligent Connected Vehicle Technology Roadmap 2.0, which called for 50% adoption of C-V2X in new vehicles by 2025, and 100% adoption in 2030. With only 2 years to address this outstanding issue of GNSS positioning, and with V2X currently offered as an option on select trims, it is unlikely that the industry will meet the 50% adoption target by 2025, in spite of the considerable acceleration brought about by C-NCAP. In the longer term, the 2030 100% adoption target will require a pivot from the soft power/promotional role currently employed by the ICVT 2.0 roadmap to a more formal type approval mechanism.
In short, all carmakers have V2X in their roadmap, but initial programs are still of small scale, in low volume lines. Large-scale deployments will take place in 2024 and 2025 because of the China NCAP.
It is well understood that NR-V2X PC5 will not be ready for production before 2026/2027. Therefore, the industry will likely skip Release 16 and adopt either Release 17 or Release 18 if the latter is already available by the time of deployments.
After the alleged VW blessing in Europe, the industry is moving toward adopting NR-V2X PC5 for Day 2 use cases.
Addressing Compatibility between New Radio (NR) and Legacy Standards
As explored in ABI Research’s Semiannual Update: V2X presentation (PT-2557), NR-V2X PC5 (3GPP Rel 16 onwards) is not backward compatible with legacy LTE-V2X PC5. Therefore, carmakers currently deploying LTE-V2X PC5 in China will likely have to install an additional radio when NR-V2X PC5 is available to communicate with existing vehicles on the road. NR-V2X PC5 (as all PC5 technologies) is also not compatible with 11p. Therefore, carmakers deploying Day 1 V2X use cases through 11p that wish to migrate to NR-V2X PC5 (allegedly VW) would also need an additional radio to communicate with their legacy vehicles and infrastructure.
To address this compatibility challenge, Autotalks launched a TEKTON3, a 5G C-V2X sensor chipset with Day 1 and Day 2 radios operating concurrently. The Day 1 radio supports either LTE-V2X PC5 (Rel. 14/15) or 11p/ITS-G5, while the Day 2 radio supports either NR-V2X PC5 (Rel. 16/17/18) or 802.11bd. Due to the lengthy process of testing new technologies, the chipset is not expected to be active in production vehicles before 2026/2027.
Infrastructure in Europe: Focus on Long-Range Communication
C-Roads set a strategic focus on testing and implementing Cooperative Intelligent Transport Systems (C-ITS) through long-range communication. That is to ensure that hybrid communication works effectively, that countries with an exclusive focus on long-range communication (e.g., Nordic countries) can equally benefit from V2X, and most importantly, to take advantage of the current sizable installed base of vehicles with embedded cellular connectivity.
C-Roads emphasizes that rather than technology, their focus is on use cases. Therefore, they are willing to use the technology that demonstrates the best potential for quick and effective deployment of V2X use cases. Moreover, C-Roads has always advocated hybrid (short-range + long-range) solutions.
Long-range communication tests started in 2021 in the Netherlands, and the association is planning large-scale V2X tests using long-range communication (Uu) involving all European countries. These tests will be done in cooperation with the CAR 2 CAR Communication Consortium (C2C-CC), but not with the Data for Road Safety initiative (see ABI Research’s Semiannual Update: V2X presentation (PT-2557) for more information) because the institutions have a slightly different approach to the use of long-range communication. The main difference is the inclusion of the security header into C-Roads and C2C-CC messages to ensure the trustfulness of the safety-related messages.
Although much is being discussed about the V2X use cases that can be achieved with the low latency and specific characteristics of 5G (e.g., network slicing) and Multi-Access Edge Computing (MEC), 4G is perfectly capable of delivering non-mission-critical Day 1 use cases.
Japan is considering introducing the V2X system in the 5.9 GHz band to cope with the accelerated traffic increase. A delegation from Japan, including the Ministry of Land, Infrastructure, Transport, and Tourism, visited several different C-ITS deployments in Europe in June 2022, intending to follow the European logic.
Despite offering V2X in the country since 2015, Toyota's ITS services have only 16,000 subscribers, to date.
United States: FCC
As explored in ABI Research’s V2X Business Models: Monetizing Cooperative Mobility report (AN-5407), Ford, Jaguar Land Rover, Audi, and other industry players submitted a request for a waiver of 5.9 GHz band rules seeking permission for initial widescale deployment of C-V2X/PC5 in vehicles and roadside units. The public notice seeking comment on the joint waiver request was released on June 7, 2022. Comments and reply comments are due in late August. In April 2023, the FCC waiver was granted, allowing the applicants, which include the OEMs listed above, as well as multiple OBU and RSU suppliers and state Departments of Transportation (DOTs), to deploy C-V2X modules using the upper 30 MHz of the 5.9 GHz ITS band.
The infrastructure market has been less affected by the lack of an FCC waiver because RSUs can operate under an experimental license.
Overall, the impact on Rel 14 and 15 OBU shipments in the short term is expected to be relatively modest, due to the limited shipment volumes of some of the OEMs involved, and the long design cycle, making it difficult for automakers to respond rapidly.
More important is the long-term impact of this announcement, which effectively confirms the U.S. market as a C-V2X market. Conscious of the FCC’s withering assessment of the DSRC technology as an unfulfilled promise, vendors in the C-V2X ecosystem are conscious of the need to respond to this step taken by the FCC. While the European market has been led by OBU deployments in high-volume VW models, the U.S. market is instead expected to be RSU-led.
The infrastructure market has been less affected by the wait for the FCC waiver because RSUs can operate under an experimental license. Nevertheless, many DOTs have preferred dual-mode RSUs to hedge against a pivot back toward 802.11p technology. ABI Research expects the market for RSUs in the United States to pivot more rapidly from dual-mode to single-mode C-V2X given the additional clarity from this latest FCC decision.
It should be noted however that may DoTs are more cautious regarding RSU investment, particularly those that now find their 802.11p investments redundant. There is a growing interest in ETC applications using the Rel 14 protocol to position a concrete V2X application with short-to-medium term advantages. Regardless, signalized intersections are expected to remain the principal target for RSU deployment.
Today, 5G is found in a handful of premium EVs featuring large displays allowing 4K and 8K video streaming. Nevertheless, interest in technology is growing. A premium Tier One supplier reported that around 80% to 99% of new Requests for Quotate (RFQs) from car OEMs are based on 5G.
Software-defined architecture and concerns over future-proofing vehicles for lifecycle management are the main drivers for 5G adoption.
China is ahead of the curve in 5G adoption in vehicles. BMW is currently offering 5G connectivity in its iX and i4 vehicles in Europe and the United States, and Audi and GM are planning large-scale 5G deployments in the United States by 2024.
Assumptions and Model Changes
Based on qualitative input and current rumors, ABI Research is using the assumption that a Scandinavian OEM will launch ITS-G5 in production vehicles in Europe in 2023.
Regardless of when V2X is included in the Euro NCAP, there should be increased deployments in 2025 in Europe.
Short-range V2X adoption in vehicles will take off in Europe by 2027, which will lead to a peak in infrastructure deployments.
From 2027, Europe will start seeing NR-V2X PC5 deployments.
Vehicles in Europe that adopt NR-V2X PC5 for Day 2 use cases will have an additional radio to communicate with ITS-G5 infrastructure and vehicles.
In Europe, NR-V2X PC5 will prevail over 11bd for Day 2 use cases.
Infrastructure players in the United States were showing high interest in dual-mode RSUs due to the uncertainty in the country (see ABI Research’s Semiannual Update: V2X presentation (PT-2557) for more details). However, there is now a consensus that C-V2X will be the adopted technology; therefore, most players are updating their RFQs with C-V2X-only radios.
Countries adopting DSRC or ITS-G5, especially in Europe, are likelier to install dual-mode RSUs to future-proof the infrastructure anticipating a scenario where NR-V2X PC5 is selected for Day 2 use cases.
Inflation, shortage of components, and supply chain disruptions are affecting OBU and RSU component prices. Hence, OBU and RSU prices will increase in late 2022.
The non-publication of RSU numbers in Europe by C-Roads in 2022 indicates that the installed base did not grow significantly since the last publication in June 2021.
Due to the war in Ukraine, EU countries are likely to allocate public funds to help rebuild Ukraine and other affected countries. This will result in lower public funds for RSU installation and, thus, lower growth rates. The effects on public funding will be felt only in 2023 because the 2022 funding was allocated and secured in 2021.
The 2022 forecast of vehicle shipments with ITS-G5 technology in Europe was significantly reduced to reflect the low new vehicle sales in the region due to supply chain/manufacturing disruptions.