News
Cars are becoming smarter, introducing a new dimension to the world of “mobility.” However, amidst a plethora of fancy terms, what exactly is the future mode of mobility? What problems does it aim to solve? It is something worth delving into further.
When we discuss “future mobility,” do images of KITT, the AI sidekick from the TV show Knight Rider, or the autonomous vehicles from the movie Minority Report come to mind? While humanity is slowly turning science fiction scenarios into reality, the challenges in the real world are far from simple. First and foremost, we must understand why there is a need for new modes of mobility.
Human Driving Is Risky: Navigating the Path Forward for Autonomous Driving
The continuous evolution of automotive technology is primarily driven by the fact that human driving is too dangerous. According to the World Health Organization, approximately 1.19 million lives are lost to car accidents globally each year. Moreover, in most countries, the economic loss caused by traffic accidents amounts to about 3% of the national GDP. To reduce fatal accidents, automotive technologies keep advancing. The ultimate goal is to achieve fully autonomous driving so as to eliminate deadly traffic incidents caused by drunk driving, fatigue, distraction, or unfamiliarity with road conditions.
The discussion about the future of mobility inevitably begins with autonomous driving. As of 2024, global research and development in autonomous driving can be broadly divided into two camps: the “LiDAR and HD maps” faction, led by technology giants and established automakers, and the “vision-based” faction, represented by Tesla and an increasing number of Chinese automakers.
“Chinese automakers and automotive technology developers have recently shown a trend of moving away from the dependence on HD maps,” said TrendForce analyst Caroline Chen. “These companies include Huawei, XPeng, Li Auto, and Pony.ai, all of which have launched urban driving assistance systems that do not require HD maps.”
Chen pointed out that the high cost of HD maps, which have an error margin of less than one centimeter and a production cost of more than TWD 1,000 per kilometer, is the main reason automakers are gradually leaving this technology and searching for better alternatives.
The vision-based faction, led by Tesla, believes that increasing computing power and advances in software can synergize with sensors that are equal to or better than human vision. When this is achieved, computers can have the same driving ability as humans without being affected by physiological factors, thereby significantly reducing the risk of accidents.
Looking at the HD maps faction, Waymo, which is supported by Google, is its leader as it has made impressive achievements with this technology. Waymo’s autonomous taxi fleets are already operational in several US cities, including Phoenix, San Francisco, and Los Angeles. They have performed well with an extremely low number of accidents. However, this success story has been overshadowed by the issues that GM is facing in the development of its Cruise series of autonomous vehicles. Cruise, which also uses HD maps, has been suspended from road testing due to the frequent accidents it caused in San Francisco.
Key Components for Mobility of the Future
Although Taiwan does not have any major automakers leading the development of autonomous driving technologies, there are opportunities for local companies in the related supply chain. Autonomous driving essentially comprises the following three things: software, sensors, and electronic control components. Numerous Taiwan-based companies specialize in the development and provision of the latter two.
“Within a few years, autonomous driving software will grow rapidly, and the number of vehicles capable of reaching Level 3 to 4 autonomy will significantly increase,” Chen said. Although automakers have yet to achieve the higher levels of autonomous driving, they are quietly engaging in a competition to secure greater computing power. This strategy aims to prevent a potential scenario where hardware capabilities cannot keep up with the pace of software development. In fact, automakers are equipping their new vehicles with as much computing power as possible, even if it is not required at the moment. By doing so, they can later enhance the functions and features of their vehicles through over-the-air (OTA) software updates, thereby ensuring the market competitiveness of their products.
Despite the recent surge in demand for automotive components, analysts have pointed out that in the evolving industry ecosystem, which is leaning towards software-driven vehicle development, the demand for standardized components is gradually shrinking. Conversely, there has been significant growth in demand for customized components and parts. If Taiwan-based suppliers can leverage their flexibility and speed, they will be able to enter the supply chains of major automotive companies during this latest transition.
It is also worth noting that while the ultimate goal of fully autonomous driving has yet to be achieved, automakers have already recognized changes in the industry ecosystem. The traditional product development cycle of “minor modifications every three years and a major overhaul every eight years” is no longer suitable as vehicles need to be upgraded at a much faster pace to keep up with the latest technology trends. Moreover, as the computing power of onboard processors increases, the functionality of vehicles also expands. This has prompted automakers to shift their focus towards software as a source of profit.
Many automakers are now planning to offer subscription-based services, encouraging vehicle owners or operators to pay to unlock a variety of functions and features. For example, Kia’s EV9 comes with the option to purchase special patterns/animations for the headlights and displays. Mercedes-Benz and Porsche are working to develop a market for third-party automotive apps, thus replicating the existing ecosystem for mobile/smartphone apps. BMW came under the spotlight recently for locking certain features behind a paywall, such as heated seats and steering wheels. However, the company has since reverted the decision to make certain features a paid subscription service due to market feedback.
As established automakers explore ways to monetize automotive software, Tesla, which is leading the trend of software-based cars, offers “Full Self-Driving” (FSD) software for a price in excess of TWD 220,000. Tesla also provides a “Premium Connectivity Service” that enables its vehicles to access 4G networks, although the company has yet to start charging for this service.
Technologies and Business Models Fuel New Imaginations about Mobility
Aside from automakers exploring new avenues for revenue and profit, car owners also have opportunities to benefit economically from the latest technological advancements. Even though Uber’s business model for car sharing has been constrained by regulations and is gradually transforming into a ride-hailing service, these mobile service platforms have introduced a new strategy known as “shared car rentals.” Under this model, car owners can rent out their vehicles to others when they are not using them. After all, when car owners are working in office buildings or sleeping in their homes, their vehicles are idle assets that depreciate over time. By leveraging software, the internet, and smart vehicle unlocking technology, they can turn their vehicles into a source of passive income.
This idea can be taken further, leading to the creation of an “autonomous taxi fleet” that individual vehicles can join when their owners are not driving them. Computers will drive the vehicles to pick up passengers for a period, and then return to the owners’ homes or workplaces to pick them up when needed. Car owners will not only save on parking fees but also receive a portion of the taxi fare earned by their vehicles. At the same time, fleet operators save on the cost of purchasing vehicles, thereby creating a win-win situation.
Forty years ago, humanity envisioned future cars as companions that could pick up their owners on their own. Today, autonomous vehicle fleets are capable of doing just that. However, vehicles of the future are expected to do much more than simply transport people from one place to another. They are evolving into hubs for entertainment, work, and personal assistance. But before we reach that stage, is there a possibility that we could first eliminate the nightmare of highway congestion? Perhaps that day is closer than we think.
(Photo credit: Tesla)
Press Releases
TrendForce anticipates that by 2026, the global tally of public charging stations will soar to 16 million, marking an impressive threefold increase from 2023 figures. As this unfolds, the global ownership of NEVs—which includes both PHEVs and BEVs—will surge to 96 million. This sets the vehicle-to-charger ratio at 6:1, a significant drop from the 10:1 ratio observed in 2021. Notably, major players like China are paving the way; having set ambitious goals to achieve a vehicle-to-charger ratio of 2:1 by 2030, China is unquestionably a driving force in the global push to reduce this ratio.
Europe is steaming ahead with its net-zero blueprint, targeting the construction of a whopping 17 million charging stations by 2030. America, though, presents a contrasting picture. With a little over 200,000 charging stations currently, the Biden administration aspires to hit the 500,000 mark by 2026. Unfortunately, this will coincide with a projected NEV count of 15 million, exacerbating the vehicle-to-charger ratio to 32:1 Around the same period, Europe and China are projected to sport more modest ratios of approximately 9:1 and 4:1, respectively. Using Europe’s ratio as a yardstick, the US charging infrastructure ambition may need to be bolstered by at least three to four times.
NEV owners globally grapple with a maze of charging standards. Prominent among these are the US standard CCS1 (Combo), the European standard CCS2 (Combo), Japan’s CHAdeMO, China’s GB/T, and Tesla’s NACS standard. Europe and China offer a simpler scenario for their citizens by adhering to a single domestic standard. In contrast, the US is a battleground, with both CCS1 and NACS standards vying for dominance. While adapters provide a temporary bridge between the two, the rapid rise of NACS kindles apprehension among CCS1 aficionados about their future stake.
A diverse array of charging standards across the globe means charging equipment manufacturers must adopt flexible product strategies to cater to different market specifications. Spotlighting Taiwanese firms: Hotron Precision’s charging cables, Longwell’s and SINBOS’s integrated charging systems are all laying tracks across GB/T, CCS1, and CCS2 standards. A feather in the cap for Hotron Precision is its induction into Tesla’s supply chain, while Longwell and SINBON primarily cater to North American charging enterprises. Riding the wave, following proclamations by giants like Ford, GM, and Volvo favoring the NACS standard in North America, charging station behemoths like Zerova and LITEON have thrown their hats into the NACS ring.
From 2025, the landscape will shift dramatically as countries step on the gas to phase out gasoline-fueled vehicles. While the ramp-up of charging station infrastructure still lags, auto giants are bracing themselves to spearhead the charging station market boom. Case in point: Titans like GM, Mercedes-Benz, BMW, HONDA, Hyundai-Kia, and Stellantis are joining forces to spin off dedicated charging infrastructure companies. Furthermore, TrendForce offers a nugget of advice for Taiwanese manufacturers: to stay ahead of the curve and serve North American clientele more effectively, consider setting up shop locally. With Pegatron and Delta Electronics already marking their territory in Texas, the focus for Taiwanese firms should be on nimbleness and adaptability, ensuring they remain unshackled by a single standard.
In-Depth Analyses
In the face of adversities within the autonomous vehicle market, car manufacturers are not hitting the brakes. Rather, they’re zeroing in, adopting more focused and streamlined strategies, deeply rooted in core technologies.
Eager to expedite the mass-scale rollout of Robotaxis, Tesla recently announced an acceleration in the development of their Dojo supercomputer. They are now committing an investment of $1 billion and set to have 100,000 NVIDIA A100 GPUs ready by early 2024, potentially placing them among the top five global computing powerhouses.
While Tesla already boasts a supercomputer built on NVIDIA GPUs, they’re still passionate about crafting a highly efficient one in-house. This move signifies that computational capability is becoming an essential arsenal for automakers, reflecting the importance of mastering R&D in this regard.
HPC Fosters Collaboration in the Car Ecosystem
According to forecasts from TrendForce, the global high-performance computing(HPC) market could touch $42.6 billion by 2023, further expanding to $56.8 billion by 2027 with an annual growth rate of over 7%. And it is highly believed that the automotive sector is anticipated to be the primary force propelling this growth.
Feeling the heat of industry upgrades, major automakers like BMW, Continental, General Motors, and Toyota aren’t just investing in high-performance computing systems; they’re also forging deep ties with ecosystem partners, enhancing cloud, edge, chip design, and manufacturing technologies.
For example, BMW, who’s currently joining forces with EcoDataCenter, is currently seeking to extend its high-performance computing footprint, aiming to elevate their autonomous driving and driver-assist systems.
On another front, Continental, the leading tier-1 supplier, is betting on its cross-domain integration and scalable CAEdge (Car Edge framework). Set to debut in the first half of 2023, this solution for smart cockpits offers automakers a much more flexible development environment.
In-house Tech Driving Towards Level 3 and Beyond
To successfully roll out autonomous driving on a grand scale, three pillars are paramount: extensive real-world data, neural network training, and in-vehicle hardware/software. None can be overlooked, thereby prompting many automakers and Tier 1 enterprises to double down on their tech blueprints.
Tesla has already made significant strides in various related products. Beyond their supercomputer plan, their repertoire includes the D1 chip, Full Self-Driving (FSD) computation, multi-camera neural networks, and automated tagging, with inter-platform data serving as the backbone for their supercomputer’s operations.
In a similar vein, General Motors’ subsidiary, Cruise, while being mindful of cost considerations, is gradually phasing out NVIDIA GPUs, opting instead to develop custom ASIC chips to power its vehicles.
Another front-runner, Valeo, unveiled their Scala 3 in the first half of 2023, nudging LiDAR technology closer to Level 3, and laying a foundation for robotaxi(Level 4) deployment.
All this paints a picture – even with a subdued auto market, car manufacturers’ commitment to autonomous tech R&D hasn’t waned. In the long run, those who steadfastly stick to their tech strategies and nimbly adjust to market fluctuations are poised to lead the next market resurgence, becoming beacons in the industry.
For more information on reports and market data from TrendForce’s Department of Semiconductor Research, please click here, or email Ms. Latte Chung from the Sales Department at lattechung@trendforce.com
(Photo credit: Tesla)
News
According to the news from Mydrivers.com, BYD has reached a groundbreaking milestone, producing its 5 millionth new energy vehicle. The company asserts that China now possesses critical new energy vehicle technology and a robust industry chain.
BYD contends that a globally recognized brand stands as a vital hallmark of an automotive powerhouse. Throughout the annals of automotive industrial history, every automotive giant has harbored a world-renowned brand. For instance, the United States boasts General Motors, Ford, and Tesla; Germany takes pride in Volkswagen, Mercedes-Benz, and BMW; Japan and South Korea have cultivated their own globally esteemed brands. Presently, China lacks a universally acknowledged world-class automotive brand.
Yet, recent reports from Mydrivers.com highlight that China has already ascended to the status of a new energy vehicle juggernaut, wielding pivotal core technology and a comprehensive industrial framework, thereby freeing the automotive industry from constraints. Objectively, China possesses the foundation and capability to forge a world-class brand. Subjectively, the emotional desire to establish such a global automotive brand exists.
BYD also anticipates that by 2025, the penetration rate of new energy vehicles in the Chinese market will surpass 60%. In 2022, Chinese brands forayed into over 50% of the market for the first time, with projections indicating that within 3 years, their market share will escalate to 70%. In a recent development, data from the China Association of Automobile Manufacturers (CAAM) indicates that in the first half of this year, China’s complete vehicle exports surged by 76.9% YoY, surpassing Japan and claiming the global lead for the first time.
Insights
TrendForce’s latest research finds that global sales of new energy vehicles (NEVs), which encompass battery-electric vehicles (BEVs), plug-in hybrid electric vehicles (PHEVs), and fuel-cell vehicles (FCVs), rose by 70% YoY to 2.87 million units for 3Q22. Of the quarterly total, BEV sales accounted for 2.147 million units and registered a YoY growth of 75%, whereas PHEV sales accounted for 714,000 units and registered a YoY growth of 57%.
Tesla placed at the first place in 3Q22 BEV market, BYD is the biggest threat
In the global ranking of BEV brands by vehicle sales for 3Q22, Tesla took first place with 344,000 units. While Tesla managed to maintain its market share at 16%, its lead over second-placed BYD in sales figure had narrowed further. BYD sold 259,000 BEVs in 3Q22, posting a massive YoY growth of 182%. It is also worth noting that the gap between Tesla and BYD in BEV sales has been smaller than 100,000 units for two quarters straight. SGMW and Volkswagen respectively stayed at third and fourth in the ranking, showing no change from the previous quarter. As for fifth to 10th, TrendForce especially points out that these places were all taken by Chinese brands. Looking at the global top 10 BEV brands for 3Q22, MG Motor (that has been acquired by SAIC Motor) and Geometry entered this group for the first time mainly thanks to the robust demand from China. Conversely, Hyundai, Kia, and XPeng Motors were pushed out of the top 10. XPeng stated that the deliveries of its new electric SUV G9 would ramp up this October. Whether XPeng will remain in the group of top 10 for 2022 depends on its performance in the fourth quarter.
Huawei’s big plan in the automotive market: the rise of Chinese brand “AITO”
Turning to the global ranking of PHEV brands by vehicle sales for 3Q22, BYD was at the top with 279,000 units and held a market share of 39.1%. As for other PHEV brands, they still were unable to raise their market shares above 10% even though they posted a QoQ increase in vehicle sales. Looking at the two German luxury car brands that are involved in the PHEV segment, Mercedes-Benz rose to second place in the ranking because of a QoQ gain for vehicle sales in both the home market and China. BMW saw falling sales for its PHEVs in Europe, so it posted a decline in units and slipped down in the the ranking. Chinese brand AITO entered the group of the global top 10 PHEV brands for the first time in 3Q22 and was immediately placed fifth. AITO is a brand under Seres and is in close cooperation with Huawei, and its vehicle models feature many technologies from Huawei as well. Going forward, the market performances of AITO’s vehicles will actually be an important indicator of Huawei’s progress in the development of an automotive business.
Moving into 4Q22, TrendForce believes that autumn releases of new vehicle models and year-end promotional activities will be the main drivers of car sales worldwide. Consumers have been waiting for new vehicle models or new generations of the existing vehicle models. This is one of the reasons why some carmakers saw declining vehicle sales in 3Q22. Therefore, these same carmakers could still get a boost in annual vehicle sales from their performances in the fourth quarter. As for the Chinese NEV market, it will stay fairly hot in 4Q22 as car brands operating there continue to provide incentives for vehicle purchases. Furthermore, Chinese consumers still want to take advantage of their government’s NEV subsidy program before its termination.