Are we letting a California car company conquer the European automotive market?
Last week, I received a letter from a leading European vehicle manufacturer asking me to visit the nearest workshop because there is a recall affecting my vehicle. I called the nearest garage, and after a few rings, I was put on hold before receiving an appointment for the following week.
The following week, I went to my dealership and dropped off the car, but had to wait there as it takes me over 30 minutes to get home on public transportation. Meanwhile, I decided to check some emails. After two hours, a nice gentleman came to inform me that everything was now up-to-date and I could go home again. I asked him what was done and he replied, "We updated a few ECUs."
I was taken aback.
At Atos, we developed an online platform for a different car manufacturer for exactly this purpose, and Tesla has been doing over-the-air updates for years now.
You can understand my surprise. How much time did that cost me? How many employees were involved? How many cars were recalled? Why are we putting our connected car innovations at risk in Germany? Is this why Elon Musk built a gigantic factory in Germany — to show us how IT, cars and technology are combined?
How Tesla conquered the European market
A few years ago, Tesla was faced with the immense challenge of penetrating a saturated market and gaining ground there — of which they did an incredible job, by the way. It’s estimated that Tesla has overtaken Porsche's market share in 2021. In Germany, there were 26,000 new registrations for Tesla vehicles and only 20,000 for Porsche (as of October 2021). However, it must also be mentioned that not everything was a big challenge. Tesla had a competitive advantage in terms of IT and technology that can't be ignored: Greenfield!
In comparison, European car companies have historically grown systems, some of which still run on DOS-like applications and are difficult to replace. Integrating systems from different departments across the value chain and bringing them together on one platform is an immense challenge, but sometimes this is the only way to compete against digital-savvy car manufacturers.
A few years ago, Tesla faced the immense challenge of penetrating a saturated market. Now, it looks like it has overtaken Porsche's market share.
How did this happen, and what can European automakers do to fight the digital upstarts?
Updating thousands of cars in one fell swoop
Consider this: There are more than 100 different electronic control units (ECUs) in modern vehicles. An ECU can be thought of as a small computer with its own software that requires occasional updates. To save customers a trip to the shop and save large amounts of money, web-based online platforms can integrate all the key system components and update these control units over-the-air.
I would like to illustrate this with a business case based on a real scenario: Consider a car brand that sells 2 million vehicles per year, of which 80,000 belong to a specific category, and 30,000 of those are four-wheel drive. Perhaps the engine control unit of these vehicles needs to be updated, and each update costs €80. A letter would need to be sent to 30,000 vehicle owners, asking each of them to drive their vehicle immediately to the nearest dealership to have an update applied. I think we can see how a lot of time, resources and money will be spent to update these ECUs.
When Atos started its very first over-the-air update project back in 2017, no other car manufacturer besides Tesla updated its vehicles via mobile data. Since then, most automakers have caught up, but we are still pioneers in this business and our platform can flash ECU notifications via mobile data.
Using the Atos platform, we can create recall campaigns that target the owners of these 30,000 vehicles to update their ECUs quickly and automatically. Companies don't have to send letters. The receptionist doesn't have to make appointments. The repair shop doesn't have to schedule mechanics to do it.
All that customers need to do is just press the “Start Update” button.
They don't have to make an appointment. They don't have to drive to the workshop. Most importantly, they don’t need to waste time waiting for their cars. It works just as seamlessly as it does with our smartphones.
By the way, software updates are now basic features. Ergo, they are self-evident basic customer needs, so they only notice them when they are not fulfilled. Honestly, do you ever truly notice how often your mobile phone has been updated?
Making auto companies ready for the digital future
Now, imagine all the ECUs everywhere — not only in cars and products, but also in workshops, factories, office buildings, air conditioners, etc. In short, wherever an electronic device is installed.
Together, we can transform the future of the European auto industry, helping create digitally-forward, future-fit ECUs and cars for tomorrow. Oh, and in doing so may we prove to Silicon Valley that we are not just engineers. We are the architects of the future.