Qualcomm Gears up to Drive Automotive Industry Transformation

Qualcomm Gears up to support the transformation of the automotive industry

Qualcomm recently held a first-of-its-kind “Automotive Investor Day” in New York. The event was organized to highlight the new ventures Qualcomm is embarking on in the field of automotive technology. The company is building on its presence in 250 million vehicles using its connectivity and telematics technologies. Its telematics and connectivity-based automotive revenue is estimated at $1.3 billion in 2022, up from $975 million in 2021. With this exclusive roadmap, revenue is projected to reach $9 billion in 2031, which at based on total addressable market (TAM) size, are conservative in our view. Licensing is also part of an automotive effort with the QTL (Qualcomm Technology Licensing) program, which aims to collect $5 per connected vehicle, with 5G expansion expected in 2024.

Qualcomm's automotive efforts begin with its expertise in telematics and connectivity, the first branch of its Digital Chassis suite. Telematics and connectivity here include modems, GPS, Car2Cloud and more. The second largest unit in terms of projected revenue generation is the digital cockpit, which has infotainment systems and driver/passenger interaction. This section includes GPU, CPU, OS support and more. Finally, we have the highest revenue generating unit, ADAS/AD systems, called the Snapdragon Ride platform, which is related to autonomous driving components, computer vision, ML and powerful computing processors.

The cars are already on their way

Qualcomm's automotive presence precedes the revamped approach that underpins Automotive Investor Day. At the first event of its kind, Qualcomm emphasized its dominance in wireless technology in hardware and software and how such a reputation brings value in terms of automotive applications. Through its tie-ups with OEMs such as Stellantis and General Motors, Qualcomm provides connectivity/car-to-cloud, digital cockpit and ADAS/AD systems solutions. Some of this technology is already on the way with the Cadillac Lyriq EV and the Opel Mokka-E. A new Mercedes-Benz model, reportedly the EQE SUV, is expected to launch next year. The car is due to be presented in mid-October.

One technology platform

Qualcomm strives to drive the transformation of the automotive industry by using cutting-edge technologies and unlocking the potential for passengers and OEMs. The automotive direction towards EVs is key to redefining the automotive language of design and in-car experiences. One feature that is proving valuable is the direct link between the vehicle owner and the OEM. The vehicle itself will perform other tasks, such as collecting data and analyzing driving patterns and improving artificial intelligence for safety, map guidance and software bugs. Connecting a vehicle to a centralized system adds value to both ends of the vehicle. The "One Technology Platform" facilitates scalability while maintaining consistency across Qualcomm's wireless leadership and established automotive technology suite.

The Digital Chassis suite offers a combined platform within the vehicle, from connectivity to ADAS. Enabling high-end vehicle applications expands the potential of automotive designs and improvements. Qualcomm has chosen to design and manufacture systems on chips (SoCs) that can be for OEMs and their intended passenger vehicle concepts. The key idea is to reduce costs and increase the utilization of SoCs that can be used in any type of vehicle and at any price.

Qualcomm will offer flexibility and customization based on OEM needs and work with Tier 1 suppliers. The company noted that OEMs are focusing on region-specific features and capabilities that affect pricing and usability. So the concept of one technology is still used, but with interchangeable features to suit the intended market, such as traffic patterns, surrounding environment and regulatory obligations.

Vehicle life cycle and software as a differentiator

Unlike the smartphone industry, automobiles have a longer life cycle, which changes the perspective of technology implementation. To ensure a long vehicle life on the road, Qualcomm's designs have built-in future-oriented applications such as L3 and L4 AD systems. With its recent acquisition of Arriver, Qualcomm is focused on further investment in technology for faster implementation and safer driving. Longevity also requires software updates and maintenance, which Qualcomm addresses by emphasizing the One Technology concept and the OEM's role in the cycle.

OTA firmware updates and enabling new features can play a vital role in keeping your car up to date with the latest technology. With such an approach, passengers may be able to experience a customized ride using OEM-specific apps or software add-ons. Additionally, sensor algorithms and vehicle performance mapping will always be improved. Vehicle connectivity thus becomes essential as in-car experiences require being online almost all the time.

Snapdragon Ride, ADAS/AD in scope

Given the importance of ADAS/AD development in Qualcomm's automotive strategy, Snapdragon Ride was introduced in detail. The roadmap showed SoC designs, vision system development through the Arriver, and an automated rider stack in collaboration with BMW.

The Snapdragon Ride Flex SoC is expected to be the first automotive supercomputing SoC to integrate various operations including vision, ADAS/AD and networking. The SoC will continue to be developed to reach Level 4 and even Level 5 autonomy, while featuring additional passenger applications in terms of infotainment and digital cockpit. AI accelerators would complement the SoC to ensure fast computations and enable data collection to adequately scale the solution when using a centralized cloud system. The Snapdragon Ride platform is a branch of Digital Chassis about driving experience and enhancing it through interconnected functions.

C-V2X is another application that Qualcomm is focusing on. With such technology, cars would be much safer and constantly connected to their surroundings, from pedestrian detection to nearby parking spaces. In addition to other SoC and wireless technology applications for OEMs, Qualcomm offers SoC vision, C-V2X and sensors/LiDAR working together within a single ecosystem.

The Snapdragon Ride SoC requires an extensive compilation of computing power and precision to run smoothly. With that in mind, Qualcomm has demonstrated the prowess needed to enable this technology. From multi-SoC to computer vision, using AI and ML algorithms to improve the system and continuous improvements, all this allows OEMs to instantly connect the update to all other vehicles.

Design-win Pipeline: From $19 billion to $30 billion in two months

Qualcomm's automotive push shows strong performance with an increase of $11 billion in two months towards the automotive technology portfolio. The technology firm has leveraged its digital chassis to strengthen OEM partnerships and engage in automotive innovation with TAM estimated at $100 billion by 2030. Add-ons include both software and hardware with TAM addressing vehicle connectivity, cockpit digitization and driver assistance systems .Estimated revenue for 2031 has been raised from the November 2021 forecast of $8 billion to over $9 billion with a CAGR of 18%. The CAGR from 2022 to 2026 is estimated to be 32% with potential revenues of over USD 4 billion, up from USD 3.5 billion from the previous estimate. The revisions indicate the operational scope of expanding OEM partnerships using digital chassis technologies, increasing the number of profitable designs and revenues associated with expansion and licensing. Content per vehicle ranges from $200 to $3,000 depending on the desired features to be put in.

The projected revenue does not include other opportunities listed at the event, which included two-wheelers and e-bikes, domain controllers and last-mile autonomy. However, Qualcomm will explore these applications in the long term. Such opportunities can catapult the use of C-V2X technology and further expand TAM and Qualcomm's technology capabilities through various offerings, whether in automotive or wireless technologies. The One Technology concept also adds value to OEMs' efforts to extend direct customer reach through additional technologies and offerings, providing customers with truly personalized yet unified use cases.