Cars Of Future Will Have 4-5 Chips Doing Work of Hundreds, Says KPIT Tech's Ravi Pandit
What is going to be sold is not a one-time car but a lifetime of mobility solutions, says Ravi Pandit.
When the world's automakers have just emerged from an acute shortage of semiconductors, KPIT Technologies Ltd.'s Ravi Pandit says the cars of the future will require significantly fewer chips.
"About five years ago, if you were to go and buy an upmarket Lexus or any other high-end car, it would typically have almost like hundred chips in it, 100 ECUs as we call it," Pandit, the group chairman of the company, said during a session, titled Future of Mobility, at BQ Prime's Future Today Summit. "Now, the whole architecture is going to change where there is going to be only four or five chips into it."
"So one chip will take care of powertrain, one will take care of autonomous driving, one will take care of the body controls, etc.," he said. According to him, architectural and software changes would mean that four or five chips would actually displace 100-120.
The auto industry veteran has long emphasised that increasing importance of software in vehicle manufacturing will lead to cars being built around it, dramatically altering the industry's current practice.
"The main flip that has happened is instead of vehicles having software in it, now, there is software around which a vehicle is built," he said. "And we will see the changes more and more as time goes by."
What is going to be sold is not a one-time car but lifetime mobility solutions, according to Pandit. "The companies will first sell you a car, but will also give you an update much in the same way as we get updates on iPhones," he said.
According to him, these "software-defined vehicles" and lifetime relationships with customers will mean automakers would like to own the customer's presence inside the car for all kinds of commercial transactions.
The rapid transformation to computer-on-wheels will require huge investments on research and development from manufacturers, he said.
Pandit expects the industry to change beyond recognition over the next decade.
According to a study by the consulting firm Roland Berger, the annual R&D spending on automotive software will more than double to $59 billion in 2030, from $26 billion in 2021.
While the huge investment figure may mean higher costs, the consultancy expects it to save $16 billion every year for the manufacturers, starting from 2030.
Pandit compared the scenario with the early 20th century period when Henry Ford democratised car ownership, and thereby, completely changed the rules of the game.
In the current environment, automakers are trying to get into manufacturing of semiconductors, batteries, fuel cells and designing software so that they have complete control over the value chain, he said.
Car Ownership Changes
According to him, rapid urbanisation and rising population in cities means the purchase of a personal car may be up for debate. The shift is happening from a personal car to a shared car, and more intense usage means the life of cars in terms of years will go down, he said.
"We will see more commercial usage than personal, high intensity usage, shorter launch cycles and faster replacement of cars," he said.
Pandit expects buyers to become less brand conscious.
"There are going to be a lot of emerging disruptors as the brand won't make much of a difference when you have to just ride a car instead of owning it," he said.
The significantly higher valuation of tech-enabled automakers will also mean that they have more money to invest than the traditional players.
Shorter Manufacturing Cycle
Since manufacturers will have to churn out new models quickly, they will look to shorten the time taken between prototype and production, Pandit said.
The cycle of designing and production takes at least five to seven years, which automakers would want to achieve in not more than two years, he said.
Investing in future technologies "is a matter of life and death" for manufacturers, Pandit said.
As the industry leapfrogs to a different era, Pandit said one will ask questions, such as: "Why did we try to drive vehicles when it could drive itself? Or why did we even own a vehicle when we could use one on demand? Why did we emit so much gases when electricity could drive vehicles seamlessly?"