The Six Five team discusses the automotive technology coming out of the CES 2022 event.
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Patrick Moorhead: But hey, let’s move to the next CES topic, which are automotive technologies. It is just amazing. I look 10 years ago, and at CES, and the biggest automotive technology was an add-in stereo or a video system to keep your kids zombies as you’re going on the big trip. But it’s become a very different CES, Dan.
Daniel Newman: Well, let’s be frank, and you can still be Pat, right? But the fact that CES was probably attended, what, about a third of its normal attendants, maybe even a little bit less than that, gave us a ton of time to put attention on a few things, and if you really looked at what was making headlines, the automotive advancements, and innovations, and announcements, and partnerships definitely were show stealers. You know, a couple years back, Pat, as we headed into Mobile World, I said a similar thing about Mobile World. It was becoming a bit more and more of an automotive show. But mobility and vehicles are somewhat synonymous, right? So, in the way we travel, whether that’s through a fully autonomous vehicle that gets us from point to point as passengers, or what I would say the global love affair with vehicles, across the globe people love cars, and we, Pat, are no exception to loving cars, makes that a hot topic and a headline grabber every single time.
I wrote a piece in Forbes and basically the header on this piece, Pat, was that the collision of tech and automotive were on display. And again, to your point, I still remember going to Best Buy and walking in the back corner of the store and looking at the cool stereos. Remember the ones that would come out of the dash and they would actually have a little screen on them, and they were super cool? It’s like Pioneer would make them, companies like Alpine. I don’t even know if they’re around anymore. But now, what we’re really seeing is the chip makers are becoming the future drivers of automobiles. The BOM on a vehicle in 2030 is going to be something around 20% semiconductors. We are legitimately moving into an era where semiconductors will be the single most important component in a vehicle.
What happened at CES? Well, Mobileye. I’ll do just a really quick run through. Mobileye’s new EyeQ Ultra, first autonomous vehicle on chip that was built specifically for L4, so Mobileye is moving quick, and Mobileye is kind of a black box approach. So, what they’re doing is partnering with companies that can take the Mobileye system, and they can take the system on chip, put it in, and it is fully contained and available. And by the way, the EyeQ, the initial system, I believe they’ve shipped over 100 million units to date, and so, as we’ve heard about the Mobileye spinoff from Intel, I believe that’s going to be a massive value creator this year potentially for investors and shareholders. It’s something I feel is very interesting to watch.
Qualcomm had their new vision system called the Snapdragon Ride vision system. Scalable, modular, computer vision, built on system on chip technology. It’s designed for implementation in multiple camera systems, ADAS, autonomous driving. And then, of course, what’s really interesting about Qualcomm is they’re really taking a modular approach to the entire digital chassis of a vehicle. So, you’ve got the ADAS system, telematics system, telematics, you’ve got the entertainment and infotainment, but I like the Qualcomm modular approach is definitely leading to a whole bunch of wins. Recently BMW, GM, Volvo, Renault, doing extremely well right now. This is a part of the business that I think is starting to finally be baked into the company’s valuation.
And you can’t leave out NVIDIA. Now, NVIDIA’s business run on automotive has been someone stagnant. It has not been growing nearly as much in the last few years. But their DRIVE Hyperion platform is still out there. They were able to announce a bevy of tier one suppliers. EV makers, trucking companies. Their new latest generation platform, 12 surrounding cameras, 12 ultrasonics, nine radar, three interior sensing cameras, and a front-facing lidar. So, they are using all the stacks to try to be able to create, and where they’re doing really well, Pat, is they’re doing really well on the EV makers, especially over in Asia. But they announced Polestar, NIO, Xpeng, and a number of others that are going to be building on their platform. They also announced a full autonomous trucking partnership and they’re incorporating their Avatar, the Omniverse Avatar technology, to tie together speech, AI, computer vision, and NLP.
And Pat, we couldn’t probably talk about the automotive without the most impressive demo, and I’ll let you talk more about it, because you drove some hundreds of thousands of views on Twitter, but that’s our friends, customer, at Luminar, who was able to demonstrate some very, in difficult situations, using lidar to be able to do ADAS at a level that, well, we saw Tesla certainly could not handle as it was running over the demonstration, the test dummy, over and over again, while the lidar technology was able to help avoid. So, those were some of the demonstrations, but yes, automotive, big time, no oxygen left for you because that’s what you get for doing that to me.
Patrick Moorhead: Man. This is a tough one. I don’t even have any toys to bring into view, either. So, yeah, I’m going to talk about a demo that Luminar did, and for those of you who aren’t aware of Luminar, they’re a full stack provider of lidar solutions. And full stack all the way. Semiconductors up to the enclosure, to the software that makes it run. They have big deals with Volvo so far and a couple other folks. What I want to point out is there’s a big argument in the industry of do we need lidar or not, right? So, there’s three sensors. There’s lidar, there’s radar, and then there’s vision. Elon Musk has gone on record basically calling it a fool’s errand and folks that love Tesla, the Tesla longs, they jump on the bandwagon and they reflect this.
But the other thing I’ll throw out there, I think Elon Musk is brilliant, but he’s three years behind his commitment to do a coast-to-coast full automated trip. The company is late with its full self-driving software. Go back and look at the claims that were made five or six years ago and the reality is this stuff’s hard. Lidar used to be, if you see a self-driving car, it used to be that sensor on the very top of the car that looks like an old police siren. It’s giant. And by the way, those used to cost $5,000 to $10,000 apiece. And I would even say that lidar at $5,000 to $10,000 apiece, aside from maybe a robo taxi, is a fool’s errand. But this company, Luminar, has a full module that costs about $1,000 and it’s small. It actually looks like an air intake as opposed to this giant, gaudy siren that needs to be a foot above the top of the car. So, the tech has changed. There’s been a 10X cost reduction and the improvements have been…
So, to make a long story longer, Luminar had I would say it was absolutely the best demo at CES, which had real, live cars in a parking lot.
Daniel, you and I attended, and my son Pico did, where they had a Tesla, they had a Luminar-enabled Lexus, and a couple other ADAS cars. And then they had a fake child run across the road. It was dark. And they had a demo where the child was occluded by a car up until the very end, and you can see the video in our show notes. Net net, the Tesla, which I was driving, just blew right over and I ran over the fake kid. It was jarring. I have to admit. You had a nervous laugh, but it did not stop. Tesla’s ADAS system did not stop for the child. The Lexus that was enabled with the Luminar system stopped on a dime. It was abrupt, but the child was saved.
And that really got me thinking, Daniel, why isn’t lidar more popular? And I know $1,000 is a lot when the average gross margin on an average car is $5,000, but don’t use averages when you’re talking about EVs, because EVs are a lot more expensive. And I think more automakers should make that an example.
Daniel Newman: Yeah. I don’t think there’s any circle back here, buddy. I think having sat in the back seat, you’re right. The word jarring is appropriate. And I think the opportunity to incorporate lidar at scale is going to be a way to provide safety. I can’t quite understand when around $1,000 a vehicle you could save lives. The only thing I could say is somehow the National Traffic Safety Board, or I think it’s the NTSB, or whomever it is that does this stuff hasn’t been able to quite determine mathematically the lives impacted. But what I saw was accidents that can be prevented. Technology can prevent accidents. We should put the focus on that like we’ve put the focus on other health safety over the last couple years. This is real and accidents are a killer of people young and old.
So, I know we don’t have any more time on this one, but yeah, I could talk about this forever.
Patrick Moorhead: Yeah. And a shout out to Ian Cutress for putting the comment out there. Mobileye is driving down the cost, as well. So is ON Semiconductor, so there’s a lot of companies out there in addition to Luminar trying to drive that down, but hopefully with three or four vendors driving it down, the cost can get below a $1,000 cost, and it can become… But I’m thinking it should at least be an option. I’m sold on it. That doesn’t mean I don’t like vision, I don’t like radar, but I like technologies that can see far, see in the dark, and have increased intelligence over having a complex vision system.
Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. Read Full Bio