Stellantis sees more revenue from software by 2030
Carmaker Stellantis plans to generate about €4bn (roughly R71,769,915,000) in additional annual revenue by 2026 from software-enabled products and subscriptions and €20bn (roughly R358,939,400,000) by 2030, the company said on Tuesday.
Presenting its long-term software strategy, Stellantis said it expected to have 34-million connected vehicles on the streets by 2030 from 12-million now as CEO Carlos Tavares maps out plans for the world's fourth largest carmaker that was created less than a year ago.
The group is aiming for full-year revenues just below €150vn (roughly R2,694,198,000,000) this year.
Software is playing an increasing role in vehicles from managing electric motors and batteries to supporting functions such as autonomous driving, entertainment and navigation.
Investors are evaluating automakers' software capabilities, which include improving battery performance and strategies for gathering, interpreting and monetising data from cars.
Rival Volkswagen expects €1.2-trillion (roughly R21,554,755,056,000) of software enabled sales in the car industry by 2030, or about a quarter of the global mobility market, which is expected to more than double to €5-trillion (roughly R89,792,300,000,000) as a result.
US electric car maker Tesla is widely seen as having a lead in software capability while legacy automakers are scrambling to catch up.
Among those legacy firms, investors and analysts see Stellantis lagging companies such as Volkswagen and General Motors in making investments in advanced technology.
Ford this year hired the former head of Apple's car project, Doug Field, to lead its advanced technology and embedded systems efforts. France's Renault is teaming up with Google to help design its infotainment systems.
Starting from 2024, Stellantis said it would deploy three new technological platforms powered by artificial intelligence, to be named STLA Brain, STLA SmartCockpit and STLA AutoDrive.
"This is something that will put Stellantis among the leaders, if not the leader, in software and electronics," said chief software officer Yves Bonnefont, adding these platforms would match those of competitors.
Software development investments are included in a plan announced by Stellantis this year to invest more than €30bn (roughly R538,589,120) through 2025 to execute its electrification strategy.
Bonnefont said the group would move its vehicles from current dedicated electronic architectures to an open software platform, leveraging partnerships.
"We don't want to do everything by ourselves," he said.
Stellantis has strategic partnerships with companies including BMW, iPhone maker Foxconn and Alphabet Inc's Waymo, to enable it to "continue to drive innovation, efficiency and shared know-how", it said.
Bonnefont said Stellantis planned to finalise by the end of 2021 a joint venture with Foxconn to supply in-car and connected-car technologies across the auto industry.
The group on Tuesday announced a preliminary agreement to create a second partnership with Foxconn to design purpose-built semiconductors to support the carmaker and other customers.