Automotive Industry Trends, 2012 and Beyond

By Stephan Lehmann, Director, Global Automotive Marketing, Freescale

They used to say that the automotive industry changes only very slowly; technology is years behind other applications and therefore, business is boring. However, the years 2009 to 2011 have been everything but boring. First, sales crashed faster than ever before, and the industry reacted with a reduction of production capacities and other cost reductions, even going so far as shutting down projects in development or closing plants. Then, in 2010, we experienced an unexpectedly fast countermovement and the entire industry was focused on meeting minimum production demands. And finally, when everyone hoped that normalcy might return in 2011, instead we experienced the consequences of earthquakes and tsunamis in Japan followed by a flood in Thailand. The ups and downs of the automotive electronics market have been hiding the fact that the industry as a whole is also undergoing a significant structural change. We have known for years that innovations in the automotive segment are becoming more and more dependent on electronic components and software. Four large trends drive the industry forward and give us hope for growth in the automotive semiconductor market for the next decade; growth rates over and above the 7.2% per year forecasted by WSTS (World Semiconductor Trade statistics) for 2000-2010. Energy efficiency and emission reductions, the reduction of worldwide 1.3 million traffic-related deaths (WHO World Health Organisation), the increased interconnection of the automotive electronics in itself, as well as the car with the environment, and - last but not least - the shift of demand for cars from developed countries to emerging countries - all generate additional requirements and demand a significant change from the industry. Car manufacturers and Tier 1 suppliers invest a large portion of their expenses in the segment of vehicle propulsion, since a whole bundle of traditional and innovative drive technologies all the way up to battery and energy management are being developed in parallel. For suppliers of microcontrollers this means that they must offer increasingly stronger processing performance and introduce multi-core technologies at the upper end of the portfolio, such as the Freescale Qorivva family, which offers single to multi-core scalability across almost application areas in Powertrain, Chassis & Safety as well as Body & Security. Product architecture and intelligent peripheral modules provide capacity for increased system performance and are often underestimated. Modern microcontrollers must be specialists for classic combustion engines yet also require additional functionality, e.g. for the efficient control of electrical motors. ISO 26262 increases development efforts and boosts the complexity of components due to redundancy and diagnosis requirements. Data sheets of 8000 pages or more that we will see in future Automotive MCU generations are a sign of this trend and give a glimpse of the demands being placed upon customers in terms of hardware and software design. Simultaneously, fast-growing markets in Asia, South America, and Eastern Europe are seeking cost-effective solutions for automobiles, motorcycles, and even e-bikes in order to meet local purchasing power while still conserving resources and ensuring environmental protection. These opposing demands require scalable product families with maximum reuse. Furthermore, customers, specifically in those emerging countries, have come to expect that semiconductor manufacturers offer their system competency in the form of reference designs that integrate all required components such as microcontrollers, sensors, analog components, communication interfaces, and software, in order to accelerate time-to-market for the customer. The global supplier presence at the ever-increasing number of our customer's R & D locations presents another challenge with respect to staffing, communication, and supplier efficiency.

Regarding safety, passive safety systems have achieved a high level of penetration in the developed markets. The fruits of these investments have lead to a clear reduction of traffic-related deaths. Sadly, WHO predicts an increase of traffic-related deaths on a global level for several more years to come. A bundle of measures - from legislation to consumer transparency by way of crash tests, all the way to even more cost effective implementations - is required to make passive safety systems a standard requirement. To achieve this, Freescale and Bosch have combined their airbag products and jointly defined a reference demonstrator. It is expected that in the beginning of the second quarter, it will provide interested customers with easy access to a platform that connects scalable products of both companies while simultaneously helping to ensure communication and diagnosis between all Bosch and Freescale components. Customers benefit in addition from an attractive user interface that will enable efficient development.

Besides passive systems, we are now also seeing a plethora of active safety systems also known as Advanced Driver Assistance Systems (ADAS), which shall ultimately help prevent accidents from happening. Radar technology and cameras are finding their way into the automobile adding to the sensors already present today. They require increased processing power and more complex communications to ensure best connectivity amongst all the sensors within a vehicle. The catchword is "sensorfusion", which, in combination with real-time connected navigation, will increase energy efficiency as well as safety. We are currently witnessing the integration of Ethernet as a high bandwidth standard bus into the vehicle - and, once again, Freescale in cooperation with vehicle manufacturers, tier 1 suppliers, and even competitors was one of the leading participants for the first system. We are the universal partner supporting the development of SiGe-based radar on a global level; we believe to be the supplier for multi-core with more dual-core lockstep MCUs in the field than any other manufacturer in the world; we are the supplier for the highest performing, scalable single to quad-core processors with highest-performing graphics accelerators. It is our opinion that the automotive industry is at the beginning of a phase that is going to generate highly complex networked systems. Functional safety as it is standardized in ISO 26262 places additional challenges to systems and development processes, particularly in that area. We will only be able to master these complexities and get them ready to go into mass production jointly, with an association of partner networks.

We are not only seeing increased connectivity within the automobile, we are also seeing networking with other vehicles as well as the environment; and we are seeing the necessity of providing the enormous amount of information in such a way to the driver that he or she is aware of and able to respond appropriately to the traffic situation at all times. Processor and graphics performance and software requirements for this segment already surpass all other applications within a car by far. The industry is faced with additional challenges due to the fact that at least four operating systems from the consumer segment are available. Genivi Alliance is a standards approach of the industry to try to put successful concepts like open source software and development networks in place for the automotive industry. Today, Freescale stands behind systems like Ford® Sync® and GM® OnStar® and besides promoting the i.MX product roadmap of pin-compatible single to quad-core processors, advocates the cooperation within Genivi Alliance in order to manage the complexities. Besides the above-mentioned mega-trends there are other factors, which will continue to be of great significance. These include the reduction of power consumption for all components, all ECUs as well as the vehicle network as a whole. Some of the measures are new power-savings modes in the MCUs, partial CAN as an option to activate only partial networks in cars. Battery monitoring in itself and the resulting energy management of the complete vehicle architecture are already of great importance but will become an indispensable requirement for pure electrical vehicles in order to maximize the driving range of the vehicle. Freescale has recently presented the intelligent battery sensor MM912J637 - a component of the S12 MagniV product family, which offers S12 16-bit based system-on-chip solutions that can be powered directly with 12V - in order to enable the industry to rely on fully automotive-qualified battery sensor components with very low power consumption. Work sharing and software standardization, e.g. through AUTOSAR, are also going to support increasingly complex and costly developments. Freescale made significant investments, and one of the major milestones of 2011 was the first key customer that certified Freescale to meet the expectations of a development process according to Spice Level 3. New requirements for the software development process, which are a result of ISO 26262, are also implemented as a component of the SafeAssure measures advanced by Freescale. The decisive factor will be that the industry continues to pursue the standardization of software and resists the temptation of demanding customized variations from AUTOSAR or freezing software "side strings". Only consistent implementation will yield the expected improvement in quality and productivity gains from reuse. Freescale has been a market leader in the area of semiconductors for automotive applications for more than 30 years. With its broad portfolio of microcontrollers, processors, analog components, sensors, and professional software it delivered more than 750 million integrated circuits to Automotive customers globally in. The uppermost priority of Freescale is the continuous development of technical innovations of the highest quality, on a global level, together with our partners, in order to address the four trends of the industry as stated above while simultaneously developing business models that offer financially sustainable solutions for the topics of long-term supply, supply guarantee, and hardware and software quality, which gain more and more attention.