1. Auto Embedded Software: Summary
EU position in auto embedded software is strong
Strong future EU competitiveness has some risks
Software standards will bring major advantages
Software standards also brings commoditization
Indirect economic value and impact of auto embedded software is much higher than direct market value
European Commission Project: IPTS-2009-J04-17-NC JRC/IPTS

2. Auto Embedded Software: Big Picture
Auto Industry Overview & Perspectives
Software standards: Upheaval impact
Implications of Software Standards
EU Auto Software Position: Good & Bad News
Current Problem: Infotainment Software
Future Problems: Commoditization; EV Software?
Retaining EU Auto Software Strength: How?
New Software Opportunities
Infrastructure Connected Auto Software
European Commission Project: IPTS-2009-J04-17-NC JRC/IPTS

3. Worldwide Auto Sales & Production Trends
Auto production & sales growing from 60M range in 2009 to 90M+ in 2020
Production is usually slightly higher than sales; except 2009

4. Regional Auto Sales Shares
Developed countries are losing market share in auto sales: EU, USA & Japan
China & others developing regions are growing their share
EU auto industry must follow regional auto sales growth or stagnate

5. Autos In-use per Capita Trend
Autos in-use per 1000 people
Autos in-use per capita shows that USA/WE/Japan are near saturation with little growth
USA/WE/Japan auto sales are primarily replacing autos that are scrapped
China, A-P and other regions are growing auto sales and autos in-use per-capita

6. External Trends with Auto ICT Impact
Key Information
Comments
Green Issues
Lower emissions
Better fuel efficiency
Less traffic congestion
Most improvements from ICT
Emerging ICT shows promise
Accident Mitigation
Passive system: crash protection
Active systems avoid crashes
New systems are ICT based
New ICT warn/correct driver errors
Connected World  Car
Drivers want connection
Car systems need connection
New ICT systems for connection
Emerging ICT functions
Infotainment Expansion
Digital music growth
Mobile device growth
Digital TV & video emerging
Used in auto audio systems
Connected to auto audio systems
Connected to passenger systems
4 main external trends are increasing usage of auto ICT systems
All trends will continue and will grow SW volume & value in autos
ICT=Information & Communication Technology
ICT=Information, Computer & Telecommunication

7. Core Auto and Infotainment Systems
Domains
Function
Examples
Powertrain
Controls the power and its distribution to the auto
Engine control
Transmission control
Chassis
Controls the functions that guides the auto’s direction and speed
Steering control
Brake control
Suspension control
Safety & ADAS
Controls the auto’s safety systems. Many new systems are emerging
Air bag control
Seat belt control
Adaptive cruise control
Body & Comfort
Controls the driver and passengers’ convenience and comfort systems. Includes dash board & related controls
Heater & air conditioning
Windows & seat control
Window wipers
Instrument cluster display
Infotainment
Controls the entertainment and information systems used by driver and passengers
Radio & music systems
Navigation systems
Telematics & mobile phone
Multiple auto ICT segments, but 2 main segments: Core auto control & Infotainment
Core auto ICT controls all systems that make the car a transportation system
Entertainment & information are growing in importance

8. Key Auto Trends: Mostly ICT Based
Key Information
Comments
Powertrain Trends
Gas & diesel engine will improve
EV importance growing
EV’s electricity from many sources
Long-term EV will become leader
Mostly due to electronics advances
EV is a when, not if-question
Battery, engine-generator, hydrogen
Is it in 2025 or 2035?
Driver Assist & ADAS Trends
Mostly warning systems
Mostly for luxury autos
Driver error correction emerging
Collision mitigation emerging
Future integrated systems
Lane, blind spot, speed, parking
Ultrasound park assist is exception
Stability control and others
Improves safety systems effect
Based on ICT
Connected Car Trends
Multiple communication links
Telematics applications & services
Connected navigation systems
Connected auto control systems
Embedded, driver phone & others
eCall, safety & infotainment functions
Traffic information & others
Remote diagnostics & others
Entertainment Trends
Digital radio receivers
Digital music player interfaces
Internet radio emerging
Premium audio systems
Satellite radio in some regions
USB, iPod and streaming Bluetooth
High bandwidth communication link
Surround sound music systems
4 ICT trends are highlighted due to their large SW growth—current & future
Powertrain ICT are mostly impacted by green issues ADAS ICT are due to high auto accident costs
Connected car ICT follows the connected world Entertainment ICT is going digital & connected

9. Electronic Control Unit (ECU)
ECU Hardware Overview
Key Information
Comments
Microcomputer (MCU)
Many types, often defined by bit-size
32-bit are most powerful MCUs now
On-chip memory for many functions
On-chip electronic buses, several types
8-bit, 16-bit, 32-bit MCUs
64-bit used in special cases
Program & data storage
Connect to other chips/devices
Memory
Extra memory for complex functions
Additional memory chips
Electronic buses
Multiple buses: low to high speed
High-speed use separate control chips
LIN, CAN, FlexRay, others
Due to higher complexity
Sensors
Measure pressure, temp, speed etc.
On-chip or separate chip/device
Actuators
Control mechanical devices in auto
Usually separate chip/device
Reliability
Auto industry requires extra testing
Auto-grade more reliable than PC chips
For better reliability
Higher cost per chip/device
For reference: Definition and overview of the ECU
Electronic Control Unit (ECU)
ECU is the basic building block for auto ICT systems

10. Auto Software Overview
Core Auto Systems
Infotainment Systems
System Examples
Powertrain
Chassis & Body
Safety & driver assist
Entertainment (Head-unit)
Navigation
Telematics
Application Software Examples
ECU control software:
Engine management
Anti-lock brake system
Air bag management
Turn-by-turn navigation
Digital music player software
eCall activation software
Operating System
Middleware software
OS nucleus (kernel)
Driver Software Examples
Electronic bus control
Pressure sensor driver
Fuel injection driver
DVD or disk control software
Speech input or output software
Display control software
Software Standards
AUTOSAR to be dominant
GENIVI Alliance
QNX, Microsoft Auto & others
For reference: Definition and overview of auto software elements: First system examples for 2 ICT categories
3 main Software categories: Applications, OS and Software Drivers
SW platform standards are becoming crucial building blocks
SW Platform Standard: OS, SW Drivers & Standard Interfaces for Applications

11. Auto Functionality Is Mostly Software-Defined
SW Defined Car Era
Changeable operation
Graceful degradation
The car is the most complex product in volume production!
ECU domain clusters Software API standards Remote SW Upgrades
Digital Car Era
Platform architecture
Re-usable software
AUTOSAR
Remote Diagnostics
ECU Growth
Analog-Digital Car Era
Digital control system growth
ECUs
Summary: SW is becoming THE component that defines what a car is and can do!
Complex SW-based product are eventually linked to a SW management center
Cars: not if, but when
Analog Car Era
Analog control systems

12. Auto Embedded Software: Big Picture
Auto Industry Overview & Perspectives
Software standards: Upheaval impact
Implications of Software Standards
EU Auto Software Position: Good & Bad News
Current Problem: Infotainment Software
Future Problems: Commoditization; EV Software?
Retaining EU Auto Software Strength: How?
New Software Opportunities
Infrastructure Connected Auto Software
European Commission Project: IPTS-2009-J04-17-NC JRC/IPTS

13. AUTOSAR Implications Category Key Information Other Information
Positive Implications
EU companies lead standard effort
EU companies lead deployment
Standards expand market size
EU company opportunities
Application opportunity last longest
Multiple upgrades to come
EU luxury brands lead
Early EU expertise gained
OS, driver & applications
Applications need innovation
Negative Implications
Standards increase competition
Standards lead to commodity products
Commodity products has low profit
Global expertise, not local
Post 2015 for OS & driver
Favours low-cost regions
Current implications are primarily POSITIVE
Future implications: Some are NEGATIVE

14. GENIVI Implications Category Key Information Other Information
Positive Implications
Infotainment OS/API standard effort
Open source advantages
Standards expand market size
EU company opportunities
Application opportunity last longest
US, EU & other regions
Low cost, no dominant player
Many advantages
OS, driver & applications
Applications need innovation
Negative Implications
GENIVI not likely to be dominant
No head start for EU companies
Standards increase competition
Standards lead to commoditization
Commodity products has low profit
QNX & Microsoft competition
Unlike in AUTOSAR
Global expertise, not local
Post 2015 for OS & driver
Favors low-cost regions
Current implications are primarily POSITIVE
Future implications: Some are NEGATIVE

15. Auto Software Standard Landscape
QNX CAR
Apps software interface
Reference platform
Used by most OEMs
2002 deployment
Microsoft Auto
Apps software interface
Software standards
Fiat, Ford, Hyundai/Kia
2006 deployment
Core Auto Systems
Powertrain systems
Chassis & Safety
ADAS & Driver Assist
Body systems
Comfort & Convenience
Infotainment Systems
Audio systems
Navigation systems
Rear/front-seat entertainment
Mobile device connections
Telematics systems
Others?
SW Platform spectrum & 2 Auto ICT Segments
AUTOSAR & Core Auto Systems go together
Platform SW battle is in the Infotainment ICT segment
AUTOSAR
Apps software interface
Software standards
Multiple MCUs
deployment
GENIVI
Apps software interface
Software standards
BMW, GM, PSA, Renault
deployment
Android
Apps software interface
Software standards
Conti auto platform
deployment

16. Software Standard Impact
Impact/Changes
Comments
OEM Control
Higher level building blocks
OEM retains more control
Design details less important
Computer platform components
System architecture become crucial
Tier 1 may provide less value
New Suppliers
Computer platform focus
Contract manufacturers
bSquare, Elektrobit, Vector, dSpace
Flextronics (Ford Sync)
Feature Growth
Faster feature upgrades
Remote feature upgrade
Platform-based design advantage
Used by Ford Sync
Cost Savings
Fewer ECU types
Higher ECU volumes
Re-usable system software
Better development tools
Fewer software errors
Commoditization post-2015
Standard ECUs tailored by software
Lower cost per ECU
Lower cost per OS & driver software
Higher software design efficiency
Lower software development cost
From local to global competition
Commodity Effect
Hardware commoditization
Software commoditization
Eventually happens with standards
New features to grow software value
Mostly all is good for the auto OEM: New suppliers, Feature growth, Cost savings
Suppliers will see more competition
Commodity effect is a future big issue for all parties

17. Auto Related Software Spectrum
Test & Diagnostic Software
Auto Embedded Software
Core auto software
Infotainment software
Future applications
New core SW
New infotainment SW
Auto Impact
Systems
PC software
Mobile phone apps
Digital content/SW
Web content/SW
Software
Design Tools
Software design
SW simulation
Software testing
Summary that shows all the Related segments that impacts auto SW
Infotainment SW overlaps with PC, CE, Web & Mobile Communication
Transportation system overlap becoming important
Infotainment Software
Transportation Systems
ITS software
V2X software
ITS & V2X Software

18. Auto Embedded Software: Big Picture
Auto Industry Overview & Perspectives
Software standards: Upheaval impact
Implications of Software Standards
EU Auto Software Position: Good & Bad News
Current Problem: Infotainment Software
Future Problems: Commoditization; EV Software?
Retaining EU Auto Software Strength: How?
New Software Opportunities
Infrastructure Connected Auto Software
European Commission Project: IPTS-2009-J04-17-NC JRC/IPTS

19. EU Auto ICT Position Category Key Information Other Information
Luxury Auto Position
Luxury autos always ICT
EU has 3 top luxury brands
Due to initial high ICT price
BMW, Mercedes-Benz & Audi
Strong ICT Suppliers
ICT innovation for luxury brands
Later ICT for volume brands
Non-EU ICT business follows
Early market entry & leadership
Learning curve & tech advances
From non-EU auto manufacturers
Independent Auto Suppliers
All key EU suppliers independent
Captive suppliers in USA & Japan
More competition & business savvy
Delphi/Visteon/Denso captive earlier
Key ICT Suppliers
Bosch & Continental are leaders
Autoliv, Hella, Valeo, others
Across most ICT segments
Leaders in specific ICT segments
Software Companies
Many small, strong companies
Mostly focused on EU ICT
Focused on specific auto mfgs
Some global success, more is likely
Automotive Semi
Infineon & ST Micro are leaders
NXP and others are strong
Across many ICT segments
EU auto industry structure creates numerous advantages:
Leading luxury suppliers; Independent auto suppliers
Strong ICT suppliers: System, SW & Semi
Current Status: Nearly All Good News

20. EU Technology: Strengths and Weaknesses
Key Information
Other Information
BMW
Leading luxury brand worldwide
Software innovator
Leader in AUTOSAR & Genivi
USA, Europe and other regions
Crucial to continued EU SW leadership
Understands benefits of SW API VW
3rd largest auto producer
Leader in EU, China, other regions
Top EU electronics customer
Gained share in 2009 recession
Strong presence in most regions
Software, semiconductor & electronics
Other EU Auto OEMs
M-B is another luxury brand leader
M-B: 2nd to BMW in SW innovation
Others are average in SW
Strong in driver assist and ADAS
PSA, Renault & Fiat
Tier 1 Companies
Bosch & Continental: World-class
Many other strong companies
EU has strongest Tier 1 companies
Multiple segments, Strong in SW
Autoliv, Hella, Magneti, Valeo
EU position, but also other regions
Semi Companies
Infineon & ST Micro: World-class
NXP strong in infotainment
Across multiple auto segments
Other good companies in automotive
EU Weakness
Too focused on combustion engine
EV: when-question, not if-question
EU can catch-up in EV
Infotainment SW is fair to good
EU strength, but will fade post 2020
EU has the most to lose
Requires public-private effort
More infotainment effort needed
Key details on EU strengths by key companies
Current weaknesses are few, but likely to grow

21. EU Embedded Software SWOT: Current
Strengths
Luxury car leader: most SW is introduced
AUTOSAR: Standards leadership
AUTOSAR: SW competency & deployment
Diesel & gasoline engine software
Chassis control software (ABS, ESC)
Safety and driver assist software
Software and software tool companies
V2X R&D programs (CVIS & others)
Opportunities
EV software advances may make EU leaders at EV system level
Auto apps store leadership
ADAS software, systems & apps
eCall regulation as way to catch-up in telematics & connected car apps
V2X software & systems (regulation needed)
Autonomous driving (post-2020)
Weaknesses
Current EV deployment
Current EV development
Infotainment software OS & API standards
Infotainment application software
Telematics software and deployment
Threats
AUTOSAR commodity software (post-2015)
Infotainment commodity software (post-2015)
EV growth negates powertrain SW market leadership (post-2020)
Summary of current EU SWOT status

22. EU Auto Embedded Software Problems
Comments
Current Problem
Infotainment OS
GENIVI: EU Infotainment OS?
Infotainment applications
Mostly led by US companies
To counter QNX & Microsoft
Few EU software leaders
Future Problem
EV software
Engine management
Time enough to react
Importance to decline
Software commoditization
AUTOSAR software
Software standard impact
Worldwide supplier base
Current SW problem: Infotainment Future SW problems: Commodity SW
Future SW Problem: EV SW Could be an opportunity

23. Auto Embedded Software: Big Picture
Auto Industry Overview & Perspectives
Software standards: Upheaval impact
Implications of Software Standards
EU Auto Software Position: Good & Bad News
Current Problem: Infotainment Software
Future Problems: Commoditization; EV Software?
Retaining EU Auto Software Strength: How?
New Software Opportunities
Infrastructure Connected Auto Software
European Commission Project: IPTS-2009-J04-17-NC JRC/IPTS

24. Retaining EU Software Leadership
Strategy
Why or How
Minimize commodity software impact
Continue moving to advanced software
Target new promising opportunities
High-value opportunities
Strengthen infotainment software
EU can get better position
Invest in EV battery system software
Possible EV catch-up technology
Connect software to infrastructure
Local presence advantages
Improve software skills
Quality and quantity
Train software project managers asap
Highest software manpower need
Strategy: Counter problems by moving to new, innovative SW opportunities
Tie new software to infrastructure-based systems
Improve SW skills across the board

25. New Software Overview Applications Comments Core Auto Software
Petrol & diesel engine control
EV battery system software
ADAS applications
Remote ECU software upgrades
Fuel efficiency improvement
Not established yet
ACC, LDW, BSD
Error fix; functional update
Connected Car Software
Telematics software & service
Connected navigation
Connected entertainment
Remote control
eCall; Remote diagnostics
Destination download
Internet radio
Door unlock, lights on/off
Infrastructure Connected Software
V2V applications
V2I applications
ITS applications
Collision avoidance
Intersection applications
Traffic applications
Autonomous Driving
Platoon driving
Highway autonomous driving
Post 2020 application
Multiple new SW opportunities emerging: Advanced old apps & new apps
Examples of applications are shown
Link SW in 2 ways: Connected application & Infrastructure connected apps

26. Future Embedded Software Opportunities
Category
Key Information
Other Information
Connected Car Application Software
Many applications emerging
EU is behind USA in telematics
eCall: basis for telematics apps
Multiple com links emerging
For car, driver & passengers
Link to ECUs become important
eCall is EU chance to catch up
ECU, driver & infotainment links
ADAS Software
Software intensive systems
Builds on driver assist apps
EU: ADAS & sensor expertise
Sensor-based systems
Major life and cost saver
Warns or corrects driver errors
Leverage into SW leadership
V2V & V2I Software
Many applications possible
EU’s CVIS R&D project is key
More EU development needed
Early deployment create expertise
Safety, traffic & fuel-savings
Public & private cooperation
To complete system architecture
Systems & software experience
Autonomous Driving Software
Builds on ADAS & V2X systems
More autonomous functions
Compute, sensor & SW intensive
Deployment likely after 2020
Complex ECUs and software
Large software opportunities
More details on the new opportunities: 4 key segments

27. Auto Embedded Software: Conclusions
EU software industry is currently well positioned
EU has lead the development of auto software standards
There are current weaknesses and future issues
Software standards bring many advantages to EU auto industry
Re-usable software and more reliable applications
Future software development cost savings and other advantages
Software standards are also bringing future risk to EU auto software labor force size
Shifting of software development & design to low-cost regions
Due to software commoditization and lack of skilled software personnel
This is the main threat to EU embedded auto software industry
Future software opportunities can lower the commoditization threat
Application innovation is key to retain lead in high-value auto software
EU Commission need to understand that auto embedded software have a multiplier effect well above its direct economic value
Auto functionality and features are mostly software-defined
Software is a major and growing factor in EU auto OEM competitiveness
Take away Info: Auto SW is many times more important than is direct economic value
“The tail that wags the dog”