When driving a car, are you in a public or private space? The distinction is becoming increasingly blurred as car manufacturers strive to turn electric cars into connected devices. Internet-connected intelligent cars are already on the roads in many countries, with remote car access becoming more common. In certain cities in China, driverless taxis are even available. However, along with the convenience comes concerns about who has access to our driving data and ultimately our vehicles.
The Biden administration views Chinese cars and technology as both a national security threat and an economic threat. They have taken steps to ban Chinese connected-car software due to fears of spying on drivers. Beijing has accused the US of using “national security” concerns as an excuse to target Chinese companies. The economic implications of such a ban are significant since it would effectively keep Chinese electric vehicles (EVs) out of the US market.
As EV sales continue to grow, cars are evolving into software-defined vehicles that rely on software for operation and enhanced functionality. Approximately 97% of all EVs currently on the market are internet-connected.
Connected intelligent cars offer numerous benefits such as improved safety features like anti-collision systems and real-time data analysis, leading to faster reaction times and fewer accidents. Autonomous driving functions also provide mobility for elderly drivers, while over-the-air updates allow carmakers to upgrade vehicles easily. Additionally, connected cars can optimize routes, reducing traffic congestion and emissions.
Chinese EV makers have emerged as leaders in this race towards smarter vehicles. They have significantly reduced development times for new models compared to their legacy peers by approximately 30%. More than 60% of new energy vehicles sold in China this year featured advanced driving-assist features.
For example, Baidu’s robotaxi arm called Apollo Go has made significant progress by developing self-driving cars capable of handling most situations independently without a driver present at lower costs than previous models.
However, achieving these advancements has come at great expense for companies like Baidu that started investing billions from their autonomous driving fund back in 2017 but still operate at a loss due to ongoing testing efforts. To catch up with their Chinese counterparts’ progress in autonomous driving technology development areas related to autonomous driving BYD plans $14 billion investment while Nio remains lossmaking despite growing sales despite being considered leaders in autonomous driving software among local peers.
This situation presents an opportunity for global automakers lacking funds or rushing towards catching up on intelligent driving software development may turn towards incorporating Chinese technology into their own offerings rather than developing proprietary solutions themselves.
Without this option available,
carmakers risk falling behind both innovation-wise
and within lucrative markets such as robotaxis which Goldman Sachs predicts will exceed $25 billion globally by 2030.
Accordingly,
partially autonomous vehicle sales requiring driver supervision should comprise around 30%
of global new vehicle sales by then.
However,
development costs rising could make affordable EVs less accessible for buyers.
As connectedness becomes integral
to providing remote assistance,
upgrades after sale
and enabling self-driving functions through cameras
and sensors,
the potential risks associated with cyber attacks
or data breaches increase.
Connected cars could be vulnerable
to remote access manipulation affecting driver safety or false object detection through sensor manipulation.
In extreme cases,
a hacked self-driving car could even be weaponized.
The rapid advancement toward smarter self-driving vehicles is outpacing discussions surrounding privacy concerns,
cybersecurity risks
and regulation.
While closing trade borders may limit some countries’ access
to cutting-edge innovations,
finding the right balance between risk mitigation
and reaping rewards is crucial before embracing these technologies fully
