The traditional manufacturing model for the automobile industry has been to source, assemble, and integrate lots of separate components and subsystems from multiple supply chain vendors. This brittle hardware-driven approach made sense for much of the past century, but now the industry is being transformed by a more flexible software-driven model.

Old factory assembly lines made it hard to add new features to cars because manufacturers were forced to synchronize different efforts by so many independent suppliers. This lack of alignment put a limit on rapid innovations. Similarly, under the traditional automotive sales model, cars have been sold to customers with 99.9% of the functionality already in place for the lifetime of the vehicle. Simply put, what you see on the showroom floor is what you get.

All that is changing now as the industry undergoes a profound makeover. The future of automotive design will be digital. By shifting to a software-driven model, we can regularly issue ongoing software updates over time to improve existing functionality and to quickly add new features to the hardware framework.

This vision applies the principles of the modern software sector to remake the traditional automotive industry. The main idea involves the development of a standardized platform for a vehicle operating system, much like a computer operating system such as Windows. In this way, we can decouple our dependence on complex hardware fixes by simply downloading software updates to the car directly from the cloud.

For the past century, a car’s hardware has been a kind of basic commodity. What we are doing now is programming new functions into the software layer, which frees us to continuously fine-tune the user experience. Ultimately, users will be able to configure their own cars based on personal preferences for interior cabin settings, mirrors, seating, temperature, infotainment, navigation, and much more.

Under this new approach, developers get to speed new features into cars without waiting for next year’s model to be released. Manufacturers get a more flexible and extensible platform for their designs and assemblies. And most importantly, users get a uniquely customized driving experience.

In many ways, this software strategy has direct parallels to the smartphone business. Any app developer can build new applications for the iPhone or Android operating systems to offer innovations for users in their respective app stores. Phone hardware developers can also build new devices based on the OS platform, without the need to work closely with app developers to add new features and functions.

Taking the Fast Lane into the Future

We already have the capability to modify vehicle functions by downloading cloud software updates to change the behavior of the car’s hardware. Now we are progressing toward the next-level software platform to provide even more flexibility through a standard interface.

There are many benefits to taking a standardized approach. A standard interface allows engineers to speed up development of new applications without worrying about communication glitches between different hardware components. Standardization also reduces the wasteful duplication of processes while providing a more flexible platform for future customization. In addition, manufacturers can achieve big cost savings by developing their newest systems in-house, rather than paying costly licensing fees to outside vendors. In turn, these cost savings can then be passed on to car owners.

We are essentially building a complete software operating system like Android or iOS, but one designed for cars instead of smartphones. In time, the onboard computer that manages vehicle actuators and controls will require greater memory and storage capacity to integrate extensive commands coming from the user and the cloud. We have already developed a voice-activated agent for users to give verbal commands directly to the vehicle, along with a big dashboard screen that provides multimedia options powered by the onboard computer.  

This software transformation is already shaking up the competitive landscape of the auto industry, especially as more electric and autonomous vehicles take to the roads. Our laser focus at NIO is to create a premium user experience that changes how people feel about their cars. In turn, this new relationship with our cars can enhance our lifestyles through greater convenience and simplicity.

The primary goal for our R&D, design and production teams is to provide the best user-facing apps and features to increase customer engagement and satisfaction. This software-defined strategy is based on designing the entire vehicle around the user experience – everything we do stems from this mindset.

The evolution of autonomous driving will require still more functionality in the software layer to address all the different scenarios a self-driving car may encounter as it moves across different cities and climates with unique driving rules and traffic flows. For this reason, we will need to train and tune our vehicle data models much more frequently through the software platform, even as the user is driving the car.

These advances are not something we can accomplish over days or months. It will require years to succeed, and only then by taking a careful incremental approach. Our great challenge will be to finally build vehicles that can be as extensible and adaptable as our smartphones.

Or course, cars have many more parts than phones, so the complexity level is far greater. The fulcrum for this major industry shift will hinge on software applications that are simple to develop and easy to use. By ensuring dynamic software updates downloaded from the cloud in real-time, the digital future will enable car manufacturers to offer a premium user experience that yields unparalleled customer loyalty.

About the Author

Qiyan Wang is the VP of Engineering, Digital Systems of NIO in the U.S. He is a global engineering and innovative executive with a strong technical background in developing cutting-edge technologies in domains of cloud, SaaS, big data, artificial intelligence, machine learning, cybersecurity, Internet of Things, and connected vehicles. At NIO, Qiyan is responsible for developing NIO’s digital infrastructure (such as cloud, security, architecture, software platform, and development and test tools) and digital products (such as ECUs and diagnostic devices). Qiyan holds a PhD in Computer Science from the University of Illinois at Urbana-Champaign and a Bachelor of Science degree in Information Security from the University of Science and Technology in China.