Just as the auto industry was getting over the woes of the Corona disaster, it is facing major challenges in securing costs, energy and resources in the wake of Russia’s invasion of Ukraine.

Global automakers, especially European automakers, which have been investing heavily in the rapid shift to BEVs, are facing a combination of factors, including a lull in BEV demand, the rise of emerging BEV manufacturers, challenges in battery technology and supply, inflation due to geopolitical tensions, and adverse effects from their traditionally high cost structure and excess production capacity, The situation continues to be difficult.

On the other hand, the policy of aiming for carbon neutrality throughout the entire value chain, with a focus on BEVs over the long term, remains largely unchanged. All companies intend to maintain for the time being their product development while using both internal combustion engine and electric vehicle technologies, and the dominance of Japanese companies with strong HEV technologies may continue for some time.

While there are concerns about the impact of the increase in the number of BEVs with high battery costs on earnings, there are also concerns about the impact of the increase in the number of digital services that can be fully deployed by converting vehicles to SDVs (software-defined vehicles) (incorporating various functions into onboard systems through OTA, upgrading vehicle hardware technologies such as E-drive, and adding automatic driving functions). ), which can be fully deployed by converting vehicles into SDVs (software-defined vehicles), are expected to contribute to profits through expansion of digital services.

Major automotive companies are generally preparing their development systems for the shift to SDVs and developing software-defined next-generation BEV architectures, but there are noticeable delays in their development.