Hughes Telematics Connected Car – Click above for high-res image

Back in 2005, the Center for Automotive Research, with help from other groups, conducted a study that predicted that electronics and software would make up almost 40 percent of a car's total value by 2010 (PDF). Yesterday, IBM used this number in a press release when discussing the way that the computer company wants to work to simplify the millions of lines of code and the way all the electronic systems in a car work together. The number really stood out. After all, if 40 percent of the value of your car is in the electronic gizmos, what's going to happen in the near future? On the one hand, more and more electronic systems (plug-in hybrid powertrains, to name just one obvious example) will be introduced into vehicles. On the other hand, the long-term trend in electronics pricing is down, down, down (compare the computer you get for $500 today with what you got for $1,500 five years ago). To find out more, we spoke with IBM's Meg Selfe, Vice President, Complex & Embedded Systems, IBM Rational Software and it turns out that nothing is guaranteed or simple in this industry.

The issue is that all of the telematics, entertainment and other electronic systems in a vehicle are being developed by a lot of different companies. As Selfe said, the electronics reside on the chips and modules, and these come from different suppliers and the modules are not architected together, which all adds complexity. IBM's release says it wants to integrate these processes "to better manage these smart vehicles across their lifecycle." To do this, Selfe said, "We feel there has to be a decoupling of the software hardcoded into the hardware. Right now, we can't manage the complexity." Read on after the jump to find out how this might happen and what it might mean.

[Source: IBM | Image courtesy of Hughes Telematics, Inc ]



Selfe said IBM used 40 percent not as a specific and totally accurate number, but that it was "most representative of the current industry." Also, it's an indicator that the amount of electronics in vehicles are increasing because it had been pegged at 16 percent of a vehicle's total value in 1990 and was 25 percent in 2001. She said IBM has been talking to its clients about this, and feels that whatever the actual number is, it's higher than it was and less than it will be.

As for the potential for vehicles to get cheaper as a result of an automotive version of Moore's Law, Selfe said there's potential for vehicles to get cheaper but it's not guaranteed:
The devils are in the details of the delivery. My optimistic self would say absolutely, but my practical side knows there are so many possible steps to be able to execute this [that it may not happen].
Selfe said that the best possible solution would be for OEMs to take the savings from the more efficient, smarter cars and turn that into developing more fuel efficient technologies.
We feel, to keep pace with those kinds of societal demands, it's not just that we need to design differently, but we need to able to implement control functions that allows better control of emissions. You're moving away from the combustion and the mechanical aspect of the engine and we feel this is a means to an end to integrate some of those technologies that make our cities cleaner. It would be great to reinvest the saved money in innovation. In other industries we're seeing that.
There's a video of IBM vice president Scott Hebner talking about IBM's role in making "smarter cars" below.



PRESS RELEASE

IBM Addresses Complexity in Automotive Systems
Automotive Manufacturers Gain Competitive Edge through Telematics

ORLANDO, FL -- 7 June 2010 -- IBM (NYSE: IBM) today announced it has teamed with industry leading manufacturers, Hughes Telematics, Inc. (HTI) and Daimler Fleetboard GmbH, to address the growing complexity of designing and managing automotive systems. The companies have collaborated with IBM to develop software platforms that more quickly deliver telematics services to their customers.

Although vehicles are becoming more complex they are also becoming smarter. The intersection of information and communications technology, also known as telematics, is expected to be a standard feature in vehicles by 2015 according to ABI Research.1 The use of telematics allows vehicles to be connected in ways that are designed to enhance the driving experience for consumers, or increase the operational effectiveness of transportation companies.

The Growing Ecosystem of the Automotive Industry

Automotive manufacturers are also facing the challenge of having to integrate a growing amount of software, mechanical and electronic technologies across a vast ecosystem of suppliers. Additionally, these technologies need to be tracked and managed as they evolve over twenty-years -- the average lifespan of a vehicle.

Further contributing to this challenge, the evolution of automotive control electronics is expanding at a rapid rate. In 1990, the amount of electronics and software in a vehicle accounted for less than 16 percent of the vehicle's total value. Today, that share is projected to account for almost 40 percent of the value of a new vehicle.2 Due to this exponential growth in the automotive electronics industry, owning a modern vehicle is equivalent to operating thirty or more computers on wheels. In fact, the average automobile now has several millions of lines of code3 -- more than a space shuttle.

"As the use of software continues to serve as the basis for increased innovation and competitive advantage in the automobile industry, the traditional approach of developing software will not work for today's modern vehicle manufacturers and their partners," said Dr. Daniel Sabbah, general manager, IBM Rational. "Today, premium class vehicles are estimated to contain up to one gigabyte of on-board software. Clearly, the companies that will succeed in the automobile industry will be those that develop a core competency in designing, delivering and managing software."

Hughes Telematics, Inc. Chooses IBM Software and Services to Help Them Enhance the Driving Experience

Atlanta-based HTI, a leader in providing next generation connected services for automobiles, provides customers such as Mercedes-Benz USA with the ability to equip their vehicles with onboard sensing and communications systems. These systems are designed to provide drivers with an array of services -- from automatically seeking and guiding emergency help in the event of an accident, to remotely locking and unlocking vehicle doors from a smartphone, downloading location-based recommendations on lodging or restaurants, or to even locating a stolen vehicle.

As a new entrant to the telematics market in 2006, HTI needed to build its business from the ground up, and believed that doing so on an open standards platform would produce service opportunities that would put them far ahead of their competition. HTI partnered with IBM and used its software and services to design and deliver a platform for continuous innovation. As a result of HTI's collaboration with IBM, the company has been able to bring new services to the market in less than 30 days, far faster than its competitors.

IBM Global Business Services and HTI worked closely together to design and deploy HTI's core business processes that govern all customer interactions. Throughout the project, the IBM team also used IBM Rational portfolio management solutions and IBM Rational DOORS to manage requirements processes, work products and deliverables, collaborate between onshore and offshore teams, store deliverables, ensure version control on deliverables and communicate on updates.

"Our key criterion was to develop a telematics architecture that supported not only today's connected vehicle services, but also tomorrow's future developed services," said Keith Kammer, vice president of operations, Hughes Telematics, Inc., "The depth of IBM's software, services and telematics expertise has accelerated our implementation and positioned us as an industry technology leader."

Daimler Fleetboard GmbH and IBM Help Transportation Companies Increase Productivity of Vehicle Fleets

Also facing the challenges of a rapidly evolving automotive industry, Germany-based Daimler Fleetboard GmbH, a leading provider of online telematics solutions and services for commercial vehicles and logistics companies, needed to help its clients improve efficiencies and transparency in day-to-day operations and better manage their vehicle fleets.

By using IBM software as the foundation for its comprehensive telematics system, Daimler Fleetboard has been able to help clients optimize vehicle usage and routing, and deliver new functionality to vehicles remotely, without having to remove them from service. The IBM Rational software solutions support Daimler Fleetboard in developing and maintaining the software applications for its competitive services. As a result, Daimler Fleetboard can provide its clients with the newest telematics services and technologies enabling them to reduce fuel consumption by 5 to 10 percent, and to save up to 10 percent in telecommunications costs.

"For us it was clear that we wanted an integrated development environment, and one from a single end-to-end source," said Dr. Christian Ballarin, product and production director at Daimler FleetBoard. "By partnering with IBM, Daimler Fleetboard has not only been able to use this development environment to design our own telematics solutions in-house, we've also been able to run them on the infrastructure we created with IBM software. This has resulted in us dramatically reducing our own operating costs, while also giving our clients the ability to more efficiently manager their vehicle fleets."

From the IBM Rational software platform for automotive systems, Daimler Fleetboard uses IBM Rational Focal Point to manage customer and market requirements, and its product and service portfolio. The company also uses IBM Rational Software Architect for modeling and programming, while IBM Rational Requisite Pro handles the compilation of performance and requirements specifications. IBM Rational Functional Tester help to automate function and regression tests, while test cases are managed and allocated by IBM Rational ClearQuest Test Manager. This also enables Daimler Fleetboard to track bugs and increase agility across the entire application development lifecycle.

About Hughes Telematics

Hughes Telematics, Inc. ("HTI") (OTCBB: HUTC and HUTCW) is a leader in implementing the next generation of connected services for the automobile. Centered on a core platform of safety and security offerings, the company develops and manages vehicle- and driver-centric solutions to enhance the driving and ownership experience. Headquartered in Atlanta, Ga., HTI offers a portfolio of consumer, manufacturer, fleet and dealer services provided through two-way connectivity to the vehicle. Networkfleet, Inc., a wholly owned subsidiary of HTI located in San Diego, Ca., offers remote vehicle diagnostics, an integrated GPS tracking and emissions monitoring system for wireless fleet vehicle management. Additional information about HTI can be found at www.hughestelematics.com.

About Daimler Fleetboard GmbH
Daimler FleetBoard GmbH is one of the European market leaders in commercial-vehicle telematics. The FleetBoard terminal devices and services are aimed at fleet managers and dispatchers in truck and van fleets in all industries and of all sizes. FleetBoard has been established as a profitability-boosting fleet management system for a number of years. Easy-to-use technology assists drivers with their daily tasks. The wholly owned Daimler subsidiary based in Stuttgart is a DEKRA approved and certified organization in accordance with DIN EN ISO 9001:2008. Since FleetBoard was launched in 2000, more than 60,000 vehicles have been equipped for some 1300 customers.

About IBM
For more information about IBM's automotive solutions, visit www.ibm.com/automotive. To access the INNOVATE 2010 online press kit, visit: http://www.ibm.com/press/innovate2010.

1Dominique Bonte & George Perros, "Consumer Telematics: Embedded, Hybrid, Portable, and Converged Solutions" ABI Research, 2009.
2"Electronics: Driving Automotive Innovation" Auto Electronics, Facts and Forecasts (2005).
3M. Broy, "Challenges in Automotive Software Engineering" (paper presented at ICSE'06, May 20-28, 2006
).


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