Tesla technology steals a march on big manufacturers

As cars increasingly resemble digital devices, a group of technology firms that can send wireless software updates to cars are in hot demand by carmakers scrambling to catch up to Tesla in the arena of over-the-air updates, or OTAs.

Interest in the technology, through which certain car functions can be upgraded much the same way as an iPhone can, comes as Tesla is set to deliver an OTA for hands-free cruise control this month, allowing its electric Model S sedans to drive themselves on motorways.

“Tesla has made great strides in raising the profile of OTA, making it appear somewhat sexy by showing how features could be added,” said Strategy Analytics consultant Roger Lanctot. “They’re almost poking the traditional carmakers in the eye by making it look so easy.”

That has spurred the big carmakers to get more serious about OTAs, although they are hampered by the challenge of making software compatible with internal combustion engines, dealers worried about losing service revenue and security concerns.

“There’s a whole mindset change” as automakers embrace the need for the technology, said Honda spokesman Matt Sloustcher.

Oren Betzaleli, product strategy head for Israeli OTA firm Redbend, said four years ago it was hard to get in the door.

“Today, OTA is so important to car makers that we can get in right away to see the VPs of manufacturing,” he said.

Betzaleli said between six and 10 car companies are “engaged” with Redbend’s technology for cars but declined to name them. There are about 70 different computers in every modern car, each with software that has to be managed, Betzaleli said.

Michelle Avary, VP of car products and strategy at wireless carrier Aeris, said she had “yet to speak to a single OEM (original equipment manufacturer) who is not active in this space right now.”

Some big carmakers, including GM, BMW and Mercedes, are already using OTA updates, but mostly for their entertainment systems.

Mahbubul Alam, chief technology officer of Michigan-based global OTA firm Movimento, predicted that in three years nearly all car makers will have some kind of OTA capability.

Tesla has already introduced over 75 features via OTA, from raising the ground clearance of cars to boosting acceleration.

As much a tech company as an carmaker, 12-year-old Tesla is free of the constraints its rivals face - complicated combustion engines, huge model ranges, four-year development cycles and a reliance on car dealersships.

Tesla “started from a blank piece of paper,” said Avary. “They didn’t have 100 years of legacy engineering to contend with.

“Your typical combustion engine is still very mechanical. Your gasket blows, it’s gone. Tesla is different, they have a lot more software in their cars, it’s a very different beast.”


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