1、DateSubtitleSoftware-defined vehicles revolutionizing the automotive industryNovember 2024Strategy&November 2024Software-defined vehicles(SDVs)catalyze Automotive transformation1)E/E=Electrics/Electronics 2)Excl.batteryExecutive summarySoftware-defined vehicles revolutionizing the automotive industr

2、y2While we expect European OEMs to extend their capabilities and continue to drive the European ecosystem,tech players dominate the Chinese market,disrupting the traditional value chain and re-shaping value propositions.3The transformation requires OEMs and suppliers to adapt their way-to-play and o

3、perating model.To fully participate in the growth opportunities,large gaps observed in organization,processes,governance,people and culture,and tools need closing.5Effective partnering,especially with tech players,will be essential for OEMs and suppliers to realize their strategies,balancing standar

4、dization to gain economies of scale with proprietary innovation to differentiate across competition.6SDVs are characterized by decoupling hardware and software,building architecture-led platforms,and centralizing E/E1)architectures.While no OEM has launched a“full”SDV,Chinese and US players are lead

5、ing in SDV maturity.1The advent of SDVs re-shuffles automotive value pools.The markets for software development(+36bn),E/E development(+13bn),and E/E components supply2)(+199bn)are expected to grow at 5%CAGR until 2035,above the industry average.2European OEMs profits may increase by 20bn by 2035,du

6、e to the increasing market size and the shift to more profitable value pools in an OEM-partnering scenario;if the transformation fails,20bn in profits are at risk.4November 2024Strategy&22 July 2020A software-defined vehicle(SDV)is an automobile that relies on digital technology.All functionalities,