Connectivity. Electrification. Shared Mobility. Autonomous Driving. McKinsey & Company cites these four disruptive trends behind future mobility — dynamics that could help to transform the quality of life for hundreds of millions of people.
McKinsey & Company predicts that by 2030, mobility innovation could dynamically alter everything from safety in human locomotion to air quality, public spaces, and power systems. Much the same way that tiny plankton in our oceans sustains aquatic animals, MEMS, and sensors, while small, are crucial building blocks of integrated mobility.
As a partner at McKinsey & Company, Andreas Breiter will explore this connection during his MSEC 2020 presentation, Future Mobility Enabled by Sensorization. SEMI recently caught up with Breiter to preview his talk, which took place on October 7, 2020, during SEMI’s first virtual MEMS & Sensors Executive Congress (October 6-8 and 13-15, 2020) and is now available on-demand.
SEMI: You play a dual role at McKinsey & Company, advising clients in advanced industries on capital investments and serving on the leadership team of the McKinsey Center for Future Mobility (MCFM). What is the relationship between them?
Breiter: Mobility has become so much more than the auto sector. Today when we say “future mobility,” we’re talking about the convergence of many exciting developments influencing the ways that people and goods move around. Cars have become computers, and we now have to contemplate new frontiers, such as air taxis and electric vehicle infrastructure.
Mobility is changing so quickly that it’s inspiring decision-makers from other market sectors to explore what implications it will have for them. We’re helping mining companies think about their haulers, retailers think about their footprints, and insurance companies plan for autonomous vehicles. The MCFM exists as a global think tank to focus on these frontier topics, helping to ensure we are ready for the future.
During my MSEC presentation, I’ll explore how those future topics are influencing automotive mobility in the short- and long-term. The MCFM is even more forward-looking, so we’re just starting to build scenarios for what might come in 2040 and beyond.
SEMI: How are changes in the mobility ecosystem affecting the automotive value chain?
Breiter: In the past, the automotive value chain was clearly structured. We had sensor companies selling to Tier 1 suppliers, who would in turn sell to OEMs, who would sell directly to end customers.
The value chain has grown more complex, however. In the future, we might see fleets of robotaxis, which will be owned by companies instead of by individual consumers. Already today, rideshare companies are game-changers because consumers can travel by car without owning one.
Plus we see companies offer parts of the user experience, e.g., user interfaces for automotive infotainment. In the past, everything in the car was branded by the OEM, but now we have third-party platforms that let us control some of our automotive infotainment options.
SEMI: How are MEMS and sensors suppliers participating in this new value chain?
Breiter: The pervasive use of sensors in cars has driven automotive OEMs and Tier 1 suppliers to work directly with suppliers, whose close involvement eases the complexity of integration. Just think about the sensors used in autonomous driving. Getting that right is safety-critical.
We’re also seeing suppliers go beyond the individual component level to provide complete systems-level solutions. Advanced driver-assistance systems (ADAS) are a good example.
SEMI: Automotive applications tend to have some of the longest design-to-delivery cycles in the industry. Will this ever change?
Breiter: The automotive product lifecycle was typically five-plus years, with a few years of development before that and continued service after the end of the lifecycle. That gives MEMS and sensors suppliers a 10+ year timeline on one model.
With so much innovation taking place, this slow cycle won’t work forever. Over-the-air (OTA) updates, for example, enable new features when they become ready for deployment. I expect we’ll see OTA updates from many end manufacturers in the coming years.
SEMI: What changes do you foresee in ADAS and autonomous driving?
Breiter: ADAS and autonomous features will become much more common. We’ve already witnessed this progression, with introductions first in premier models, later rolling out in more affordable vehicles. Lane-change assist and the rear camera followed this path and are now pretty standard. Collision avoidance, as a safety-critical feature, is likely next in line for more widespread adoption.
As for fully autonomous driving, consumers will accept that only when it becomes safer than a human driving a car.
SEMI: Where is the greatest opportunity in the next five years?
Breiter: Electrification of vehicles is number one. When it comes to engines, we’re moving from internal combustion to hybrid and then to electric. Since OEMs are adding sensors, e.g., for the battery system, for battery management, and for electric motors, this progression represents a growth opportunity for sensors suppliers – in particular for hybrid vehicles that contain both powertrain technologies.
But that’s not all when it comes to sensors. Outside of powertrains, new sensors are added to enable a variety of functions, including, for example, ADAS and autonomy, as well as increased interior content, such as mood lighting.
SEMI: Is there anything surprising coming, sensor-wise, in mobility?
Breiter: To enable intelligent traffic systems, you need to make infrastructure smarter — which brings us to sensors. We’re going to see roads and other assets in infrastructure sense the state of traffic, sense what traffic participants are doing, and support connectivity between, for example, the infrastructure, vehicles on the ground, pedestrians on walkways, and drones in the air.
SEMI: What would you like MSEC attendees to take away from your presentation?
Breiter: We’re living in a transformative era for the mobility industry. During the last 100 years of mobility, the ecosystem barely changed. In recent years, however, we’ve seen massive technological gains, largely enabled by semiconductors, MEMS, and sensors.
Instead of serving as just one of many suppliers, I’d encourage MSEC attendees to anticipate future mobility challenges, so they can offer solutions to OEMs and Tier 1 suppliers accordingly.
For more information, visit McKinsey Center for Future Mobility.
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Nishita Rao is product marketing manager at SEMI.