Analysis

Driverless car revenue predicted to quadruple by 2025

8th December 2017
Alice Matthews

 

The modern automotive industry does not revolve around vertically integrated companies with end-to-end control from production to assembly to sales.

Author: Sam Chase, The Connected Car

it's a more diverse business model, with different companies each working on a specific piece of the puzzle. This becomes even more true as connected cars and autonomous vehicles, which require specialised hardware and software, become more prevalent.

While those ancillary businesses may not receive the recognition of an OEM, they are still large businesses with the potential to drive significant revenue numbers.

Samsung is a company that doesn't have to worry about name recognition. It is a tech giant, manufacturing some of the world's best-known televisions and smartphones. But in the automotive space, Samsung's position is less established.

However, that may be changing soon, according to Samsung President and CSO Young Sohn. Speaking with Automotive News Europe, Sohn said that he sees the rise of autonomous vehicles as a tremendous opportunity for the company.

The automotive category is currently about a $5bn business for Samsung.

"It's not much for Samsung, because we make $200bn in revenue, but I'm hoping over time that this portion will increase and we will hit $20bn by 2025," Sohn said.

Connected cars utilise great amounts of network data to power advanced driver assistance services and infotainment system features like GPS navigation and music streaming. As connected vehicles become autonomous vehicles, the amount of data used will expand exponentially as vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) connectivity become essential whenever the car is in operation.

"When you have your data increase by 100,000 times, then suddenly everything you do around your plumbing has to change," said Sohn. "That's like having a small data centre in your rear trunk, it's a tremendous opportunity for IT companies like us."

It has now been a year since Samsung made a big splash with its $8bn purchase of automotive electronics company Harman. In September of this year, Samsung launched both a $300m fund for automotive investments and a joint business unit with Harman to pursue innovation in the AV space.

Also in September, it was revealed that Samsung had obtained a permit to test self-driving cars on public roads in California.

What exactly Samsung plans to test remains unknown, but all of these comments and partnerships show that the company isn't expecting its revenue to grow passively. Samsung is taking an active role in becoming a major player in the automotive space.

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