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Automakers and In-House Software Development: What Does the 2020 Automotive Survey Tell Us?

by Ian Riches | 10月 15, 2020

The 2020 Automotive Software Survey was carried out jointly by Strategy Analytics and Aurora Labs. This blogpost examines the responses to two of the twenty questions that were posed in the survey. The full report is available for free download. The links can be found at the bottom of the post.

In recent years, many automakers have been vocal about their desire to develop more software in-house. Tesla is obviously an outlier here, but VW has stated its target is 60% in-house by 2025 with its Car.Software division.

However, the reality is that today most software is written elsewhere in the value chain, provided by a wide range of suppliers. Two important questions in the 2020 Automotive Software survey sought to throw some light on what respondents thought was actually going to happen.

The first of these questions was this: What percentage of vehicle software will be developed in-house by the mass market auto manufacturers in 2025?


One way of interpreting the response shown above would be to see that the majority of respondents saw less than 25% of software being developed in-house by the mass market automakers, with over a fifth putting it at less than 10%. On this reading, the vast majority of automotive software will remain written outside of the OEMs for some time to come.

That may prove to be the case - but I think it's missing at important dynamic that this chart reveals. What's more interesting to me is the one-third (33%) percent of respondents who saw over 25% of software being written in-house by mass market carmakers in 2025. In terms of usual automotive timescales and rates of change, this puts the in-house development of software as a very hot topic indeed!

If that proves to be the case then we're in the realms of revolution, not evolution. And revolutions can bring swift and nasty endings to those who find themselves out-of-favor.

The next question probed about the direction of travel for the amount of software written in-house, and was this: Do you expect this trend to increase over time?


Of perhaps more interest than the 76% who saw a trend towards more software authored by carmakers were the 24% who did not. Looking at those respondents, the (admittedly small) number who stated that they had worked in the industry for over 30 years were by far the most likely to reply “No” to this question. 

Is this a group of “out-of-touch” dinosaurs who are blind to the on-rushing comet of in-house software? Or is it a group of incredibly experienced industry professionals sounding a warning bell that simply stating that you desire to move in a certain direction is very far from the same thing as actually successfully making that move?  

As market researchers love to say, more research is required on this one…

The full 2020 Automotive Software survey report can be downloaded from either Strategy Analytics or Aurora Labs. In both cases, free registration will be required. 
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