Qualcomm Eyes 5G-Enabled Automotive Transformation

The company outlined its aims at the IAA Mobility show

After being cancelled in 2020 amid the pandemic, the Frankfurt Auto Show, one of the world’s largest motor shows, was reborn in 2021. Rebranded as the International Motor Show Germany and known as IAA Mobility, the event moved prominently away from its former namesake of Frankfurt to the Bavarian capital of Munich. The move marks not only a rebranding of the famous auto show, but a wholesale shift within the automotive industry, aiming to cast attention to the larger topic of mobility as opposed to a traditional focus on the car itself.

So, it was only appropriate that IAA Mobility invited the CEO of Qualcomm, Cristiano Amon, as a keynote speaker. He headlined a prime Wednesday show slot to speak about the larger transformation underway in the auto industry. Mr Amon struck an optimistic tone as he outlined Qualcomm’s vision of the future of mobility. He highlighted that 5G is central to the technological transformation in the auto industry. Naturally, as a provider of wireless communication technology, Qualcomm sees this transformation through a 5G lens; the car can be thought of as an intelligent edge device, Mr Amon argues, which in the 5G era will serve as an engine of innovation and growth for the industry.

Advances in mobility, as with many other industries experiencing profound digital transformation, are being accelerated not only by the rise of electric vehicles and the need to tackle climate change, but also by pandemic-related forces. User behaviour and changes in business models are fundamentally changing the industry; as the automotive industry becomes more and more connected and supercharged by 5G, the foundational elements of its supply chain are being disrupted. Manufacturing, buying, selling and the very individual in-car experience are subsequently all experiencing dramatic shifts in these new contexts.

People’s expectations of technological shifts are also outpacing innovation in the automotive industry. Rapid advances in the computing and communications markets are capturing consumers’ imaginations, with technologies such as digital cockpit displays, autonomous driving and rich real-time digital content giving vehicles new capabilities. This transformation will usher in an era in which the vehicle is a leading market within mobility services. Beyond these direct-to-consumer services, new car-to-cloud services and advanced communications and safety — made possible by cellular vehicle-to-everything technology — will open even more potential for advancements in mobility.

This underlines the scope of opportunity for semiconductor companies. At the same show, Intel CEO Pat Gelsinger outlined how this “digitization of everything” is leading to a fivefold increase in semiconductors’ share of the bill-of-materials for vehicles, from 4% in 2019 to over 20% in 2030. The total addressable market for automotive silicon is expected to double by the end of the decade to $115 billion, about 11% of the total silicon market.

Intel, a new manufacturing partner for Qualcomm, plans to build a new chip manufacturing facility in Europe to fulfill demand from European automakers and rectify imbalance between supply and demand. This will be essential in ensuring the semiconductor industry efficiently addresses opportunities in the auto industry.

Qualcomm, along with Renault and Google, highlighted several examples of digital transformations of the automobile. The 2022 Renault Megane, pictured below, is the result of a collaboration between the French car-maker, Google and Qualcomm.

Renault co-developed a rich and immersive in-vehicle driver cockpit solution for an electric vehicle, targeted at the urban market and based on the third-generation Snapdragon Automotive Cockpit hardware platform and Google’s Android Auto Software platform. The Renault Megane uses the electric drivetrain from the Nissan Ariya electric crossover, but adds an innovative digital cockpit.

Qualcomm has had a long history and involvement with the automotive industry. Initially supplying into the industry as a provider of infotainment hardware, the chipmaker has evolved its solutions to a third-generation design and provides 5G connectivity solutions for the sector. The company says it’s working with 23 of the top 26 global automakers, and on an earnings call to discuss its latest quarterly results stated it has a design-win pipeline of $10 billion. Last month it announced a bid to acquire Veoneer, a specialist in advanced driver-assistance systems technologies, demonstrating its intent to take a leading role in the automotive industry.

Mr Amon’s invitation to deliver a keynote speech at IAA Mobility 2021 is an example of Qualcomm’s growing influence in a sector that continues to grapple with fundamental shifts and digital transformation. Similarly, Intel’s focus on the scale of opportunity, and its steps to address supply requirements, highlights the industry’s recognition of the need for collaboration.

For the automotive industry, the embrace of digital technologies and 5G speaks to the enormity of the transformational forces at play.