Image credits: Robert Bosch Global
News Article

McKinsey's Top Trends in Tech Influencing Automotive, Part I

By Alejandro Enríquez | Thu, 07/29/2021 - 12:27

McKinsey’s top 10 trends in tech have the potential to change the automotive industry. Most of these trends gained a stronger momentum just five years ago while others, such as next-generation computing, distributed infrastructure and trust architecture have lost some. Applied AI remains unchanged given its centrality to different sectors.

"These are the trends drawing the most venture money, producing the most patent filings and generating the biggest implications for how and where to compete and the capabilities companies need to accelerate performance," writes the company. Learn about the 10 top trends and how they influence automotive businesses.

Trend 1: Next-level process automation and virtualization

Technology capabilities have allowed the next level manufacturing processes, including Industrial Internet of Things (IIoT), digital twins and additive manufacturing. According to the firm, by 2025, more than 50 billion devices will be connected to the IIoT, generating 79.4 zettabytes of data yearly. Moreover, annual installations of industrial robots have increased twice since 2015 to about 450,000, and will grow to about 600,000 by 2022. It is estimated that 70 percent of manufacturers will be regularly using digital twins by 2022 and 10 percent of today's manufacturing processes will be replaced by additive manufacturing by 2030.

During the past months, MBN addressed some of these trends. "Before the real implementation, we work on a digital twin, which is to design the product and the production line virtually. This digital-reality combination is the basis for implementing a successful digital transformation," said Alejandro Preinflak, CEO of Siemens México, to MBN.

If you want to learn more about digital twins you can read our analysis: Electric, Digital Twins Advancing Electro Mobility

Trend 2: The future of connectivity

This is where 5G comes into the scene. Fifth generation wireless technology will enable faster downloads and reduce latency to nearly nothing. "Far-greater network availability and capability will drive broad shifts in the business landscape, from the digitization of manufacturing (through wireless control of mobile tools, machines and robots) to decentralized energy delivery and remote patient monitoring. The firm estimates that 5G will reach up to 80 percent of the global population by 2030.

As previously noted by industry experts to MBN, 5G technologies serve as the foundations for level 4 or 5 vehicle autonomy. "The automotive industry is waiting for 5G networks and their greater broadbands and faster connections (lower latencies) to process what autonomous cars are seeing. The truly autonomous car will focus not only on the car’s immediate surroundings, but on the interconnectedness of all the devices in the environment," said Ricardo Anaya, Product Manager at Qualcomm Mexico.

If you are interested in learning about levels of autonomy, read our analysis: Level 5 Autonomy, Still a Long Road Ahead.

Trend 3: Distributed infrastructure

This trend refers the capability of cloud and edge computing applications to move companies' computing power further toward the edge of their networks. "This trend will help companies boost their speed and agility, reduce complexity, save costs and strengthen their cybersecurity defenses," writes McKinsey. The firm also highlights that about 70 percent of companies will employ hybrid or multicloud-management technologies. Amazon Web Services’ (AWS) partnerships with other companies are a clear example of this.

Up to date, MBN has documented broad partnerships between AWS and BMW Group, Volkswagen's Industrial cloud, Toyota, and Mexican Unicorn KAVAK.

The rest of the trends are explored on the second part of this series. Read it here.

Photo by:   Robert Bosch Global
Alejandro Enríquez Alejandro Enríquez Journalist and Industry Analyst