The leading original equipment
manufacturers (OEMs) in the automotive industry are expected to gain a 9%
higher share through Software-driven transformation, as per the report from the
Capgemini Research Institute.
As per the research, software-driven
transformation is going to offer significant benefits to automotive OEMs in the
next five years. It will also improve productivity by 40%, reduce the cost by
37%, as well as improve customer satisfaction by 23%. Around half of the OEMs
are offering connected services and only 13% are monetizing connected services
to their benefit.
It is also
observed that around 71% of OEMs are at the initial stage of their
software-driven transformation whereas 28% have implemented a pilot of this
concept. As per the research, 15% of OEMs are considered “frontrunners. OEMs
say that to incorporate software-driven transformation robust architecture,
ecosystems and strategic technology partnerships are required. Also, to gain a
competitive edge and enjoy the benefits of the software, OEMs need to transform
from legacy architecture. As of date, 93% of OEMs have traditional vehicle
architecture, while only 13% will decouple. It is also expected by the
automotive executives that the production of new vehicles that support
connected services and OTA will triple from 11% to 36% in the coming five
On other hand,
OEMs are struggling to collect data and translate it into actionable insights.
Only a few are prepared to implement cybersecurity measures. On the front of
the customers’ needs, OEMs need to upskill a large part of their existing
workforce in software skills and new ways of working. It can be said that
currently, OEMs are facing a skills gap of 40-60% in software architecture,
cloud management expertise, and cybersecurity.
Capgemini has conducted an online survey of 572
senior executives who work for automotive OEMs and a series of interviews with
17 industry experts which cover various aspects of the software-driven
transformation. The data collected informed the state-of-the software and
automotive markets about current developments and trends.
Source – Press release of "Capgemini"
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