Veoneer from 4 Nov 201926 Nov 2019 19:22
https://europe.autonews.com/suppliers/veoneer-boss-sees-software-driving-future-profit
"An industry that was traditionally building engines and chassis is now spending more and more money on software," he said. "This is one of the biggest investments that we expect in the coming decade."
A road map for profits
Batra said that relatively simple driver-assistance systems will dominate the market for the next decade despite the hype around fully self-driving cars.
"Even by 2030, we see that Level 1 to Level 2+ systems -- what we call safety and safety/convenience -- will still make up 75 percent of the market," Batra said. Those include features like lane keeping, active cruise control and automatic emergency braking, and their growth will be driven by new safety regulations.
Level 3 autonomy, in which the driver has to be ready to take over control, will make up about 25 percent of the market, and Level 4 and 5 -- true autonomous vehicles -- just 5 percent, he said.
But as complexity increases, so does Veoneer's potential content per vehicle. A simple driver support system such as emergency braking might generate $100 to $500, the company said, while "collaborative" features such as hands-free parking or unsupervised highway driving could bring $1,000 to $4,000. And a true self-driving car is predicted to generate $8,000 and up.
At the AstaZero test track, Veoneer showed a number of its recent innovations, including in lidar, radar, night vision, interior sensing, sensor fusion, and an ECU optimized to support advanced driver assistance.
-
Analysts are optimistic that Veoneer's business plan is solid, however, as automakers ramp up orders for cameras, sensors and active safety systems necessary for automated driving.
Richard Hilgert, an analyst at Morningstar, said in a recent note that he expected Veoneer's revenue growth to average 12 percent over the next 10 years, although profits would come only in 2025. He cited upcoming safety regulations and ratings, such as NCAP, as a growth driver.
"We think Veoneer has positioned itself as an integrator of technologies that are required as standard equipment by governments' new-car assessment programs," he said.
-
Software not hardware will be the name of the game (higher margins)
Sign In
Follow the stocks
