Apple has delayed the production schedule for the Apple Car from 2026 to 2028, as reported by Bloomberg. The vehicle is expected to feature a Level 2+ advanced driver assistance system.

TrendForce’s Insights:

• Aim for Fully Autonomous Driving: Apple Car Once Planned to Remove the Steering Wheel

Apple has named its project for the Apple Car “Titan”. The initial concept envisioned a fully electric vehicle without a steering wheel, potentially achieving Autonomous Driving Level 5.

The delineation of autonomous driving levels places Level 3 as a watershed: vehicles below this level still require driver control (by eyes and hands), with the system providing assistance.

Vehicles at Level 3 and above gradually empower the system to assume greater control, gradually freeing the driver’s hands and eyes. Therefore, only vehicles beyond Level 3 can be considered truly autonomous vehicle.

• Downgrading the Autonomous Driving Level: Apple’s Compromise with Market Realities

Having accomplished numerous revolutionary innovations in the consumer electronics realm, it’s understandable that Apple aims to replicate its successful model in the automotive industry. High-level autonomous driving represents a battleground where Apple can leverage its strengths.

However, with the complexity of vehicle components and the stricter validation standards for automotive regulations compared to commercial ones, Apple, if it intends to venture into car manufacturing, still needs to align with the technological development levels of other components.

For instance, to eliminate the steering wheel configuration, mature wire-controlled steering technology is necessary. However, among all car manufacturers currently, only Tesla, Toyota, and Infinity have adopted this technology, resulting in a relatively small market size.

Related component suppliers also are still in the process of research and development or observing the market. Even if suitable suppliers are found, the adoption of such advanced technology may raise the cost of car manufacturing.

Additionally, the trust between humans and machines has yet to mature, and related regulations are still under development. Achieving full confidence from drivers to take their hands and eyes off the steering wheel, even under the Apple brand, is not an easily achievable goal.

• Prioritizing Safety and Stability in Vehicle Design: Apple’s Compromise is the Right Decision

Given the direct impact on driver safety and the long product lifecycle, the automotive industry, whether traditional or electric vehicles, prioritizes safety and stability in design principles. Even with innovative technologies, their priority is secondary to safety and stability.

Designing an electric vehicle without a steering wheel is undoubtedly enticing, however, given the need for further validation in technology, regulations, and human-machine trust, the production timeline for Apple Car may continue to be delayed.

Additionally, the automotive industry adheres closely to Maslow’s Hierarchy of Needs theory. At this stage, the primary concerns for car manufacturers are not the presence of steering wheels or the level of autonomous driving but rather range anxiety and high car prices. These concerns belong to the “lower-level” needs of the demand pyramid, affecting the basic survival conditions of manufacturers.

Only by prioritizing the satisfaction of these types of needs can manufacturers proceed to fulfill higher-level demands for advanced autonomous driving.

If Apple Car’s project adjustments are indeed true, it represents a compromise with reality. However, it allows Apple to quickly introduce products to capture market share. After all, only by successfully achieving the goal of production from nothing to something can Apple have the opportunity to create a truly Apple-dominated battlefield.

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• [News] Rumors of Apple Car Possibly Using Micro LED, Could Spark an Automotive Revolution if True

Negotiations between Hyundai Motor and the U.S. government concerning tax incentives for the Korean automaker’s USD 5.5 billion EV plant in Georgia have yet to reach a conclusion.

It was first reported on August 31st 2023, indicating that Hyundai Motor Group and LG Energy Solution (LGES) would invest an additional USD 2 billion in their battery cell manufacturing joint venture (JV) at the Metaplant in Bryan County, Georgia.

The company subsequently aimed to expedite the construction of its factory in Georgia and establish partnerships with local battery suppliers to align with the Inflation Reduction Act (IRA), as stated by Hyundai’s CFO Seo Gang-Hyun during an earnings call.

In an latter interview, Georgia Governor Brian Kemp expressed concerns that the IRA is adversely affecting Korean companies. Korea Joongang Daily further noted that no Korean electric vehicles, including those from Hyundai Motor and Kia, are currently listed for the IRA tax credit. According to TrendForce’s analyst, the market share in 2023 for Hyundai Motor and Kia combined is 10.6%, which ranks as 4th in the US market, behind GM, Toyota, and Ford.

Currently, the U.S. Energy Department has reportedly yet provided a definitive response to Hyundai’s request for a 30 percent tax credit under the IRA, as per a report from the Korean media outlet Korea Joongang Daily. As reported by The Korea Daily, the potential value of these incentives could be around USD 350 million.

“We’ve been constantly discussing with the U.S. government for the incentives,” Hyundai Motor confirmed regarding the news. “Nothing has been decided, and we’re waiting for the result.” Still, reportedly, Hyundai and Kia have not announced any cuts to EV production or investment.

TrendForce notes that the automotive industry is currently facing high raw material and labor costs, as well as significant investments in electrification and autonomous driving. Balancing the protection of local enterprises, maintaining competitiveness, and managing consumer costs is an urgent task for governments worldwide. Most countries are focusing on the country of origin rather than the brand of vehicles in their restrictive measures.

Measures taken by the US—specifically for EVs—include requiring that EVs and their batteries be assembled in North America. Furthermore, critical minerals in the batteries must originate from countries that have signed free trade agreements with the US to qualify for subsidies totaling US$7,500.

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• [Insights] Hyundai Defies Headwinds with 1.52 Billion Groundbreaking for Electric Vehicle Plant

(Photo credit: Hyundai)

The U.S. lawmakers is reportedly attempting to further drive the “decoupling” of the Pentagon’s supply chain from China. According to sources cited by Bloomberg, the U.S. Congress has prohibited the Pentagon from procuring batteries produced by six Chinese companies, including CATL and BYD.

Additionally, the other four battery manufacturers set to be banned are Envision Energy, EVE Energy, Gotion High-Tech, and Hithium Energy Storage Technology. Based on the report, of the top 10 battery suppliers in the world, just three are non-Chinese companies.

It is noted that this regulation is part of the “2024 National Defense Authorization Act,” passed on December 22, 2023. However, commercial purchases, such as Ford’s procurement of batteries from CATL in Michigan and Tesla’s sourcing of batteries from BYD, are temporarily exempt from these measures.

As per IJIWEI’s report, the U.S. government has long been eyeing the Chinese new energy vehicle supply chain. Previously, U.S. Treasury Secretary Janet Yellen argued that China’s new energy vehicle industry posed a threat to the “national security” of the United States.

At the end of 2023, a document was signed, stipulating that from 2024 onwards, all electric vehicles produced in the U.S. are prohibited from using Chinese batteries. The signing of this document is evidently unfavorable for companies in the electric vehicle battery industry looking to expand into the U.S. market.

According to the conditions for electric vehicle subsidies under the U.S. IRA Act, starting in 2024, the use of battery components produced by entities from “Foreign Entity of Concern” (FEOC) countries is prohibited. In 2025, the prohibition extends to the use of key minerals processed or recycled in FEOC countries. FEOC encompasses China, North Korea, Russia, and Iran.

The U.S. Department of Energy, in December 2023, released a notification of a proposed interpretive rule, requesting comments to define FEOC, covering overseas subsidiaries of Chinese companies and overseas enterprises with more than 25% ownership by Chinese state-owned enterprises.

However, given the current distribution of the battery supply chain, completely bypassing the Chinese battery supply chain in the U.S. is challenging. Even if feasible, it would come with substantial costs. The result could be a short-term inability to reduce vehicle prices, further impacting the gradually weakening demand for electric vehicles in the United States.

TrendForce indicates that the combined sales of BEVs and PHEVs in the United States totaled approximately 1.46 million vehicles in 2023. Due to the requirement that many vehicles must meet local assembly criteria in the U.S. to qualify for subsidies, numerous models lost subsidies in 2023.

It is expected that in 2024, various automakers will increase the proportion of local assembly, expanding consumer options to stimulate demand. However, stringent conditions for battery adoption could become one of the variables affecting the growth of electric vehicle sales in the United States.

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• China Projected to Export 1.2 Million NEVs in 2023 amid Tightening Tariffs by the US, Says TrendForce
• [News] China’s New Energy Vehicle Penetration Rate Exceeds 40%, Expected Optimistic Growth by 2024

(Photo credit: Pixabay)

On January 9th, Intel unveiled its latest automotive AI chips, entering into direct competition with rivals NVIDIA and Qualcomm in the automotive chip market. In a bid to strengthen its position, Intel also announced the acquisition of automotive chip company Silicon Mobility.

Reportedly, Intel stated that Silicon Mobility, a French startup, specializes in designing System-on-a-Chip (SoC) technology for controlling electric vehicle motors and in-car charging systems, along with software. The acquisition amount was not disclosed by Intel.

As per Reuter citing from Intel’s automotive business chief Jack Weast, he has indicated that, intel’s new automotive system on a chip products will adapt the company’s recently launched AI PC technology for the durability and performance requirements of vehicles.

Weast further clarified, “Intel will not require automakers to use advanced driving chips designed by its former Mobileye unit, he said. Instead, automakers can have Intel incorporate their own chiplets to enable specific functions into the Intel system at a lower cost.”

Intel’s chips designed for infotainment systems are already integrated into 50 million vehicles. As the automotive chip market continues to expand, the demands on chips are increasing, covering technologies such as autonomous driving, upgradable in-car system software, and complex dashboard displays amid strong competition from NVIDIA and Qualcomm.

Weast has addressed ahead of the CES technology show in Las Vegas that Chinese automaker Zeekr will be the first automaker to use Intel’s AI system on a chip to create “an enhanced living room experience” in vehicles, including AI voice assistants and video conferencing. Zeekr, an electric vehicle brand under the Geely Holding Group, is a customer of both Intel and NVIDIA.

Intel will try to separate itself from rivals by offering chips that automakers can use across their product lines, from lowest-priced to premium vehicles, Weast said.

According to Reuter, Weast addressed reporters in a conference call before the announcement at the CES technology show in Las Vegas, stating, “Intel has done a pretty terrible job communicating our success in automotive, We are going to change that.”

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• [Insights] Infinite Opportunities in Automotive Sector as IC Design Companies Compete for Self-Driving SoC

(Photo credit: Intel)

During CES 2024, NVIDIA announced that four Chinese electric vehicle brands will adopt its autonomous driving chip platform. According to a report from IJIWEI, this move has showed NVIDIA’s potential intention to expand in China, despite facing stricter export controls from the U.S. Department of Commerce.

The four automakers include Li Auto, Great Wall Motor (GWM), ZEEKR, and Xiaomi, all set to utilize NVIDIA’s DRIVE technology solution to support autonomous driving capabilities.

The NVIDIA DRIVE platform encompasses automotive sensors, computing platforms, hardware and software for autonomous driving development, as well as DGX servers for artificial intelligence (AI) training.

NVIDIA has stated in the release that Li Auto selected the NVIDIA DRIVE Thor in-vehicle computer, featuring two DRIVE Orin processors with a computing power of 508 trillion operations per second (TOPS). This setup enables real-time fusion of information from various sensors, driving advanced driver-assistance systems (ADAS), and a comprehensive autonomous driving system for all scenarios.

Furthermore, GWM, ZEEKR, and Xiaomi have adopted the NVIDIA DRIVE Orin platform to power their intelligent autonomous driving systems.

GWM mentioned that its autonomously developed high-end intelligent driving system, Coffee Pilot, based on the DRIVE Orin platform, supports intelligent navigation and assisted driving functions across all scenarios without the need for high-precision maps.

Xiaomi’s first car, SU7, will be built on a dual DRIVE Orin configuration, with the assisted driving system incorporating Xiaomi’s in-house large-language perception and decision-making model, adaptable to various roads nationwide.

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• [News] NVIDIA Expands Autonomous Driving Team in China, Actively Recruiting Talent

(Photo credit: NVIDIA)