Software, Chips, and Batteries

In the latest article in Porsche Consulting Magazine, Dr. Hagen Radowski, Senior Partner at Porsche Consulting, describes, why software development is so essential and how a closer collaboration between carmakers and the semiconductor industry promises better end products.

Manufacturers need to move away from first designing a car with perfect clearance dimensions and then trying to write the right software. Instead, software development must come first. This new approach for the automotive industry has a name: the software-defined vehicle, or SDV.

Many of the new players have proved that a software-centric approach makes it easier to separate the software — which normally develops more quickly — from the hardware, which advances at a slower pace. At the same time, this increases flexibility in terms of hardware replacement. 

The most important prerequisites for software-defined vehicles are created in the semiconductor industry. Several thousand chips are used in a modern battery-powered vehicle — and digitalization and electrification will continue to drive the demand for chips in cars. The automotive industry is the sector for which the semiconductor industry needs to grow the most quickly in the years to come. And carmakers need more direct partnerships with the semiconductor industry to manage this growth.