IBM Study Predicts AI-Powered, Software-Defined Vehicles to Dominate by 2035

IBM Study: Vehicles Believed to be Software Defined and AI Powered by 2035 By Investing.com

The study highlights that over the next decade, 80% of new cars will have a powertrain that will be electrified to some extent, according to respondents. The findings also reveal that: The study is a data-led analysis of automotive and mobility industries developments over the next 10 years and is based on 1230 interviews with senior executives from automotive OEMs, suppliers, and surrounding industries across 9 countries. "The shift to software-defined vehicles (SDVs) was cited by the majority of industry executives as the key to future brand developments," said , Automotive Industry General Manager IBM. "It is indicated that vehicle value may no longer be limited to initial features and functionality"it would be earned over the life of the vehicle by continuously providing superior customer experiences with new applications and subscription-based services for drivers." The study highlights that the industry is preparing to offer deeper, more personalized user experiences that are enabled by digital capabilities. Currently just 21% of research & development budgets are currently allocated to software and digital developments, but respondents expect this to nearly triple to 58% by 2035. The research also reveals gridlock at the heart of SDV developments. The traditional approach to vehicle architecture"where software for a single domain (such as brakes) is delivered separately from another domain (such as airbags) through individual electronic control units (ECUs)"is no longer sustainable for the SDV era. To reach a future where cars are truly digital products, automakers need a sweeping overhaul of current electrical and software architectures. The technical challenge of separating software and hardware layer is seen as the top challenge. 77% of the senior executives say they are facing a lack of software development tools and methodologies. Of equal concern, 74% of respondents say a strong mechanical-driven culture is making it difficult to switch to a software-driven product development. added, "By harnessing the power of cloud combined with AI, automakers can explore new ideas, test different software configurations, and gather valuable insights to inform the development of innovative SDV features. Using AI to analyze vast volumes of data, identify patterns, and make predictions, automakers can accelerate SDV enhancements and create personalized experiences for customers." The scope and scale of issues around the development of SDVs are further discussed in depth in a LinkedIn Live broadcast today, jointly hosted by IBM and General Motors (NYSE:GM) in . A recording of the event can be found here. IBM's 'Automotive 2035' study represents the 4th edition of the automotive industry longitudinal study which started with 'Automotive 2020' published in . The full report can be found here. Study Methodology The IBM Institute for Business Value (IBM IBV), in cooperation with Oxford Economics, surveyed 1,230 C-level automotive executives in nine countries in Q3 2024. 40% of the sample represented automotive OEM and EV companies, 40% auto suppliers, and 20% ecosystem players. Participants were asked a range of questions in various formats. They were asked about their organization's expectations, results, concerns, and barriers for transition to software-defined, electrified future. About IBM IBM is a leading provider of global hybrid cloud and AI, and consulting expertise. We help clients in more than 175 countries capitalize on insights from their data, streamline business processes, reduce costs and gain the competitive edge in their industries. More than 4,000 government and corporate entities in critical infrastructure areas such as financial services, telecommunications and healthcare rely on IBM's hybrid cloud platform and Red Hat OpenShift to affect their digital transformations quickly, efficiently and securely. IBM's breakthrough innovations in AI, quantum computing, industry-specific cloud solutions and consulting deliver open and flexible options to our clients. All of this is backed by IBM's long-standing commitment to trust, transparency, responsibility, inclusivity and service. Visit www.ibm.com for more information.

IBM Study Predicts Vehicles to Be Software-Defined and AI-Powered by 2035

The transition to SDVs faces challenges, including software tool shortages and engineering culture shifts. According to IBM's latest Automotive 2035 study, 74 percent of executives surveyed believe that by 2035 vehicles will be software defined and AI powered. The IBM Institute for Business Value published its fourth edition of the automotive industry longitudinal study, which outlines a transformative decade ahead for the automotive industry, driven by electrification and software-defined vehicles (SDVs). Also Read: Qualcomm Partners with Google to Transform Automotive Cockpits with Generative AI The study, based on 1,230 interviews with senior executives from OEMs, suppliers, and related industries across nine countries, highlights that over the next decade, 80 percent of new cars will have a powertrain that will be electrified to some extent. The findings also reveal the following key trends by 2035: Software-Defined Vehicles: 74 percent of executives believe vehicles will be powered by software and AI. Brand Value Shift: 75 percent of respondents say a software-defined experience will be central to brand value. Revenue Model Change: The industry is shifting from one-time vehicle sales to recurring digital service revenues. Also Read: Honeywell and Google Cloud Partner to Bring AI-Driven Automation to Industrial Operations "The shift to software-defined vehicles (SDVs) was cited by the majority of industry executives as the key to future brand developments," said Jeff Schlageter, Automotive Industry General Manager at IBM. The study highlights that the industry is preparing to offer deeper, more personalised user experiences that are enabled by digital capabilities. Currently, 21 percent of research and development budgets are currently allocated to software and digital developments, but respondents expect this to nearly triple to 58 percent by 2035. The study also highlights critical challenges in the transition, with 77 percent of executives reporting a lack of software development tools and 74 percent citing difficulties due to a mechanical engineering-driven culture. To meet the demands of SDVs, automakers must overhaul their electrical and software architectures, moving away from traditional, siloed approaches. However, the technical challenge of separating the software and hardware layers is seen as the top challenge. Also Read: IBM Releases New AI Models Built for Business Jeff Schlageter added, "By harnessing the power of cloud combined with AI, automakers can explore new ideas, test different software configurations, and gather valuable insights to inform the development of innovative SDV features. Using AI to analyze vast volumes of data, identify patterns, and make predictions, automakers can accelerate SDV enhancements and create personalized experiences for customers."