LinkedIn11COMMENT11MORE11

With tech capturing not only the attention but also vast amount of investment, value and talent, carmakers are ploughing money into a host of areas, from autonomous vehicles to ridesharing to scooters. Perhaps more out of sight are rumblings of the auto guys getting into a game long played most famously in Northern California — designing computer chips.

Of course, exhibit A here is Silicon Valley’s Tesla, the most valuable U.S. carmaker (albeit a position it holds tenuously). For months, Elon Musk has talked about its new homegrown “Hardware 3” chip in testing now and promising, he says, to radically accelerate Tesla’s self-driving program. Granted, there is no bigger lightning rod than Twitter-happy Musk, who still can’t sell his cars in Michigan.

Though his pronouncements generate no shortage of apoplexy and eye rolling, they also may hint at what may be the hottest engineering job and business opportunity in the car industry in the decades to come.

The computer chips Musk and others are talking about are commonly referred to as systems-on-a-chip, or SOCs. The “systems” bit is due to the fact that these devices combine a whole bunch of components on a single sliver of silicon. These powerful chips, which pack a lot of smarts and consume relatively little power, are behind the explosive growth of smartphones over the last decade or so, and are critical in a bunch of other areas besides, including cloud computing.

With their increasingly fancy entertainment systems and driver-assist features, today’s cars already make use of plenty of these chips, but most of them of them are provided by suppliers. To understand why Detroit is surely considering doing more of this work in-house just consider the example of the iPhone.

Over the years Apple has done more and more of its own chip design. Today, basically everything that Apple touts as key selling points are direct benefits from having control over the chips used in their devices. Walk into an Apple Store in Troy or Novi or Ann Arbor, and you’ll encounter a helpful t-shirt-clad employee who will talk about things like battery life, performance, security, image processing speeds and quality for the camera, faster Face ID. These features all trace directly to the Cupertino-designed chips in the phones.

Ask Apple to design an iPhone XS-like device using off-the-shelf components. It would likely be possible, but I'd wager that battery life would be an hour, it would probably need some water-cooled system due to power and heat, and it would likely double the price of phones, which is problematic since there’s an upper limit to the willingness of even the most ardent fans when it comes to paying the Apple premium.

This premium is the main reason car execs may publicly spurn Musk but are probably privately mulling over their own chip-design capabilities. Largely because it’s controlled its own destiny, Apple quite famously captures 80 percent of smartphone profits despite only accounting for 20 percent of all phone sales.

The good news for Detroit is that despite endless headlines of being left behind, it’s not too late. Far from it. Insiders who know a bit about computer hardware and software and who watch the roll-out of various driver-assist features know that chips at the heart of these features simply aren’t ready for prime time.

And Detroit has what those designing computer chips and software need, the world’s most thorough understanding of reliability and safety requirements needed to put and keep vehicles on the road, critical no matter if these vehicles are car-sharing fleets, self-driving or otherwise.

The big story going into 2019 is that carmakers have an exciting opportunity to take greater control over their technological development. But will they take it?

Andrew Macleod is a director of automotive marketing at Siemens.

LinkedIn11COMMENT11MORE11
Read or Share this story: https://www.detroitnews.com/story/opinion/2019/02/01/chip-design-advancement-big-automakers/2723112002/