The commentary comes as part of the report on “Caution: Blind Curves Ahead: The AlixPartners Global Automotive Outlook” by the global business-advisory firm.

According to the study the global market for connected vehicles will grow by 20% annually over the next three years and is expected to reach €34 billion by 2017 driven by sales of hardware, telematics services, data services and in-vehicle services and applications. In 2017 some 56 million cars will be shipped with telematics and infotainment systems – 53% of them will be embedded systems, 31% of them are tethered using an external SIM card, and 16% will run on smartphones.  Regional penetration will vary, with China leading in absolute terms while North America and Japan experience the highest penetration levels, with connected cars over 80% of total sales.

Future connectivity will need to accommodate many aspects, from car-to-car and car-to-infrastructure communication, via driver information and entertainment, to advanced online services.  Thus, car manufacturers and their suppliers will have to develop and test several technologies. As hardware will likely be commoditized, OEMs should focus on the user interface and experience, while tier-one suppliers could benefit from venturing into services.

‘Betting on choosing the right system and partners for the connected vehicles delivery strategy will be a key success factor not only for OEMs but also for their Tier1 suppliers and technology providers,’ said the firm’s Stefano Aversa. ‘While a proprietary system offers more control, an open source platform might develop faster.’