Making money with software: Tesla leading for consultants, electric car startups in top group

Making money with software: Tesla leading for consultants, electric car startups in top group

As the software revolution sweeps through industries, the automotive sector is no exception to its transformative power. In a world where cars can evolve and gain new functionalities post-production, just like smartphones, software mastery becomes a pivotal factor. This not only fosters stronger customer relationships but also unlocks fresh avenues for revenue generation. While adept electric car newcomers like Tesla have embraced this paradigm shift, traditional giants grapple with its intricacies.

Making money with software

The Vanguard Trio: Tesla, Nio, and Xpeng
In a recent study by technology consulting firm Gartner, a groundbreaking “Digital Automaker Index” has emerged, ranking the 20 most influential global manufacturers based on their prowess across eight software facets. Emerging as the vanguard is Tesla, closely trailed by two Chinese electric car disruptors, Nio and Xpeng. Meanwhile, German automakers find themselves in the mid-tier, with Japanese and Jaguar Land Rover rounding off the list.

A Gateway to Software Monetization
Gartner’s innovative index aims to decipher which brands can effectively translate their software prowess into unconventional earnings, a feat atypical for traditional auto manufacturers. The categories that dictate this monetization potential include cultural alignment, leadership, workforce competence, system architectures, vehicular connectivity, autonomous capabilities, electrification proficiency, smart cockpits, and the potential for online sales.

Tesla’s Triumph in the Electric Domain
Remarkably, in the context of electric vehicles, Tesla emerges as the undisputed leader, earning an impressive overall score of 80.1%. Trailing closely are two Chinese counterparts, Nio (69.7%) and Xpeng (58.2%), renowned for their modern electric car offerings. The top five is rounded out by US startups Rivian (48%) and Lucid (46.8%), both exclusively focused on electric vehicle production.

Beyond Electric Competence
Curiously, even as the world’s second-largest manufacturer of pure battery-powered vehicles, BYD lags with a rating of 34.5%. This stands in contrast to German giants Volkswagen (41.8%), Mercedes (38.2%), and BMW (38.1%). This underscores the fact that prowess in electric vehicles alone does not guarantee software mastery. SAIC Motors, a diversified Chinese group with modern brands, garnered a modest 28.5% overall score.

Urgent Transformation Required
According to the report, traditional manufacturers are struggling to metamorphose into technology companies at the requisite pace. Without corrective measures, their trajectory will only worsen, leading to potential downfall. Gartner’s expert warns that, unless remedied, this delay could prove fatal. On the flip side, Tesla and Nio earn praise for their software-centric culture and leadership, bolstered by seasoned managers with extensive tech experience. Notably, online sales also emerge as a pivotal category, an essential prerequisite for successful software monetization.

Room for Improvement
While the frontrunners bask in their achievements, the Gartner report asserts that even they have room for growth. The Digital Automaker Index is set to be an annual update, serving as a barometer of progress in an era where software is the driving force of automotive evolution.


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