The modern automobile is fast becoming a sensor-laden mobile Internet of Things device, with considerable on-board computing power and communication systems devoted to three broad areas: vehicle location, driver behaviour, engine diagnostics and vehicle activity (telematics); the surrounding environment (vehicle-to-everything or V2X communication); and the vehicle’s occupants (infotainment). Meanwhile, leading connected car companies are expected to maintain their leadership in the global market and generate higher revenues from connected car sales thanks to their heavy investments in the R&D of relevant innovations and technologies. Who could have shared the know-how and diligence of technology emerging in connected cars segment more than the leaders themselves. In this interactive article, Satish Sundaresan, Managing Director – Elektrobit India Pvt. Ltd | Padmesh Mandloi, Lead Technical Account Manager, Ansys & Vivek Vasantha, Manager, Technical Marketing, Automotive Business Unit, Renesas connects to unravel the connected future of cars.
Drivers of Connected Cars Market in India
According to leading reports, 80 per cent of Indian customers think increased vehicle connectivity will be beneficial in the long-term. The connectivity in a car allows it to share internet access and data, with other devices both inside and outside the vehicle.
Satish Sundaresan, Managing Director – Elektrobit India Pvt. Ltd states India is now the fourth-largest passenger car manufacturing nation in the world, and connectivity is on the rise. As per as per Nokia MBiT Index report, overall data traffic in India grew by 144 percent (YoY) last year, and estimated smartphone users are around 600 million already. Hence, one can argue that Internet penetration and steady passenger car sales are driving the connected car market in India. Updates in vehicle legislation and industry compliance regarding convenience features, such as navigation, remote diagnostics and multimedia streaming through various platforms such as Android Auto, CarPlay and MirrorLink, are also moving the India connected car market forward. Additionally, new safety norms are pushing automakers to equip vehicles with the latest connected features or safety and security, and this is also propelling the demand for connected cars. The relatively younger population that buys cars translates to a significant percentage of Indian customers thinking increased vehicle connectivity will be beneficial in the long-term. Given our acceptance of online music via affordable 4G connections, bringing interfaces via Apple CarPlay or Android Auto and other basic vehicle connectivity features are now in vogue. Hence, there is a demand. A closer look at the supply side indicates that car manufacturers (OEMs) are increasingly using connected car features as a differentiator.
The connected cars market in India is currently getting driven by several factors and customer’s willingness to pay is certainly one of them, noted Padmesh Mandloi, Technical Leader, Enterprise Accounts, Ansys. While the automotive market in India remains largely price sensitive, infotainment and connectivity features are gaining some prominence now, particularly in mid-market and luxury brands. Consumer’s affinity and understanding of data is another aspect that is a driver. From navigation requirements to knowing more about the health of the vehicle to the need to connect and interact with the vehicle, data is at the center of it all. Another factor is the gradual proliferation of electric vehicles. The need to locate the nearest charging station is growing. Lastly, the availability and affordability of reasonably high-speed network is also fueling the growth of connected mobility, said Padmesh.
Whereas, Vivek Vasantha, Manager, Technical Marketing, Automotive Business Unit, Renesas, Government regulations in terms of BS-VI regulations backed by strong consumer demand is driving the connected cars market in India.
One of the largest car markets in the world, India ranks first in data anxiety related to the connected vehicles. At 69 per cent, Indian customers are the group of buyers who are concerned with the security of biometric data generated and shared with external parties by connected vehicles, reveals the a leading study.
Early Adopters of Connected Cars
Commercial vehicles, Cab service aggregators are the early adopters that will be soon followed by passenger vehicles. Also interesting there is requirement from farm vehicles for applications like VTS, Geo-fencing, TCU etc. said Vivek Vasantha.
Meanwhile, Padmesh Mandloi, elaborated, Globally, the early adopters have been the heavy vehicles (working in remote locations like mines and forests) and they felt the need for connected technologies first. The need to remotely operate such systems in either adverse weather or accessibility conditions led to this surge in the heavy vehicles. The adoption or proliferation in commercial vehicles (mainly trucks) and passenger cars started later but has picked up heavily across the world, mainly in the developed economies. Over 90% of cars sold in Japan today have fairly evolved connected mobility solution. In India however, passenger cars seem to adopt this faster when compared to the commercial and heavy vehicles. The reason being, India is largely unorganized when it comes to commercial vehicle fleet operations with several small fleet operators who are very cost conscious. However, truck operators are now resorting to connected technologies mainly to monitor driver behavior (driving pattern, stoppages) and also to monitor basic vehicle parameters like fuel economy etc. Another major reason for slow adoption in heavy vehicle and commercial vehicle in India is the poor network quality in remote locations including highway stretches added Padmesh.
Emphasizing on segment-wise adoption, Satish Sundaresan cited, This is an educated guess in India and largely dependent on what the customers push for as market standard while the OEMs work out what makes their products enticing and profitable.
We believe that each of these segments already has interesting use-cases and our experience is as below:
- Passenger vehicles in India currently focus on basic infotainment features like telephony, remotely-controlling vehicle accessories (e.g.: turning on air conditioning before you get into the vehicle)
- Commercial vehicles manufacturers are extremely interested in fleet management and possibly remote diagnostics for logistical reasons
- Heavy equipment like tractors, excavators might have more compelling reasons in comparison to commercial vehicles. Elektrobit (EB) India already works with a farm equipment OEM where the end objective is to run diagnostics, read real-time data in and around the vehicle to a central control room, if needed, and to also be able to download and upload software from this equipment remotely.
Challenges and Scopes for Connected Cars in the Indian Market
New models and segments are wooing the connected cars market in India. Given the scenario, Satish Sundaresan believes The service segment is expected to drive the growth of the global connected car market due to the application of different features such as advanced driver-assistance systems (and autonomous driving), vehicle management and mobility management. Hence a debatable challenge for India would be to either upgrade and/ or create road transport, highways and vehicle infrastructure that can benefit from the above segments or to limit the scope of what features do we want to focus in India for the moment. Additionally, a stronger network infrastructure also could help the growth of the connected car market. This implies that until advanced driver-assistance systems features are needed in India, we assume end customer expecting more accessible features like seamless smartphones integration, remote diagnostics and certain remotely accessible vehicle information and features. And this is where we possibly face our first challenge related to data privacy and security. Data ownership isn’t well defined, and our ecosystem, legislation, market dynamics, customer and consumer expectations must catch up to this new world. Then there is the question of payment models. Will vehicle owners wish to pay for new features that can be made available via software? Or will OEMs find another way to still stay profitable while fulfilling customer wishes? If the customer does not pay a service model like we do for online music apps on our phones, then the OEMs will be challenged on how to bring global features at the Indian price. Platform standardization, profitable business forecasts for the OEMs and all associated supply chain partners depend on volumes sold and the selling price. And if that is not reliable, then entering a cost-sensitive market like India can be considered a deterrent. And this means raising the possibility for lesser reliable and lower quality aftermarket fitments.
Citing on the challenge, Vivek Vasantha said, Major challenge is on the infrastructure availability especially in the rural areas of the country. TAM continues to grow for connected vehicles and it will soon be a standard part of passenger vehicles.
Padmesh Mandloi shares, One of the major drivers of growth of connected technologies globally (mainly developed economies) is autonomous vehicles (or self-driving cars). Countries like Germany and US have started to test SAE level 3, 4 and 5 autonomous vehicles. Particularly the highly (level 4) and fully (level 5) autonomous driving would require V2V (Vehicle to Vehicle) as well as V2X (Vehicle to Infrastructure) interactions, which depend on availability of 5G network. Unfortunately, India is still far behind when it comes to adoption of autonomous driving vehicles. The biggest challenge is urban traffic and the lack of road infrastructure among many others. Therefore, while globally, the connected car market will benefit from the movement towards autonomous driving, this factor doesn’t contribute in the Indian context. This is one big challenge.
The rather slow growth of telematics related features and solutions (both in passenger vehicles and commercial vehicles) would be another challenge. Vehicle health management needs are growing but not at the rate at which infotainment and basic connectivity features (like voice recognition etc.) are growing. This is a current challenge but can turn into a future scope if consumers are educated properly about the benefits of telematics to the overall cost of ownership of a vehicle. At the moment there is a tremendous potential for basic level infotainment and connectivity solutions in mass-market vehicles, and I believe OEMs and Tier-1s would continue to focus on that.
Trends in the Connected Ecosystem For The Automotive Sector
Though there are enormous new technologies emerging to complement the connected ecosystem for the Automotive sector, the veteran Padmesh Mandloi reckons there are several trends shaping connected mobility in the automotive sector. Voice assistance systems are one of them. Personalized voice assistance and alert systems are gaining lot of prominence right now. Augmented Reality enabled Head-Up Displays indicating, for example, lane markings or vehicle speed or distance to the collision while reverse parking is also becoming more important. Vehicle to Infrastructure (V2X) connectivity is another trend which is fundamental to several other solutions that will be built upon it. From a commercial vehicle standpoint, truck platooning and fleet management solutions will become more pervasive as new value streams will become clearer to the fleet operators. Finally, the need to keep the vehicle safe and avoid hacking through layered cybersecurity solutions would nearly become a necessity.
Keeping its gist, Vivek Vasantha scooped, Market is responding well to the connected ecosystem and we see there are several new designs and enquiries from OEM and Tier 1 customers alike. The present trend would start with applications like Telematics, Vehicle tracking, remote locking/unlocking, remote turn on/off with the integration of app from Android and IOS.
On the other hand, Satish Sundareshan, wrapped up stating, The trend toward “Connected Everything” is among the most important social and technological changes of our time and is revolutionizing every industry, including automotive. For automotive, it is touching most everything that we do. Simply put, the connected car is an enabler for technologies that will define the mobility of the future and further enrich our lives. When we imagine what cars and mobility mean to customers in the next five, ten or twenty years, it is hardly conceivable without connectivity.
Significantly, embedded software is estimated to be fastest-growing component for connected cars in India in the foreseeable future. This is driven by increased demand for infotainment and navigation services.
The government is working on mandates for connected services, like AIS-140. This is part of the intelligent transportation system, which in turn is a key feature of a smart city – a model vision for the authorities. Hence, the embedded market is influenced by government initiatives and regulations which in turn trends to accelerated development in this electronics space.
Additional trends in the connected ecosystem include:
- Highly Automated Driving and driverless cars, driven by innovations in sensor technology like LiDAR, radar, cameras and ultrasonic.
- AI-based convenience interfaces like virtual personal assistant responding to voice commands
- Telematics for assessing driver behaviour for a wide range of purposes like insurance, fleet management or police investigations
- Vehicle-to-Vehicle Connectivity to share emergency information like accidents, map re-routing etc.
- In-cabin monitoring systems that could anticipate driver behaviors and even unsafe driving practices
- A constant connectivity to the Internet and/ or a Cloud where software updates to the car seem as normal as to our mobile phones today