ROME – If car prices rise, it’s all the fault (or almost) of technology. In Italy, according to the Autopromotec Observatory, in 2020 the price lists of new cars compared to 2019 grew on average by 2.4%. And this doesn’t just happen to us. In the United States, according to a recent analysis published by Bloomberg Green, in 2012 over 50% of new vehicles sold were priced below $ 30,000, while in 2020 over 50% cost more than $ 40,000.
The main cause of this upward trend, in the US as in Europe and in the world, are the increasingly sophisticated technologies that car manufacturers offer on board the new cars. You want it because of the high road safety standards to be respected, or because today it would be unthinkable to sell a car that is not connected, the electronics now on board is the master. According to research by Deloitte, the cost of electronics by 2030 will represent half the value of a new car. In 1970 it represented just 5% and reached 10% in 1980, with the arrival of electronic fuel injection systems, and then reached 15% in 1990. In 2000, when the airbags, the anti-lock brakes (ABS) and electronic stability programs (Esp) have become more and more widespread, we were at 22%.
In 2010, with the development of advanced driver assistance systems (ADAS) and infotainment, electronics represented 35% of the cost of a new car. Today it is around 40% and the trend will continue to grow over the next few years. So new cars cost a lot because they have so much technology on board and as they get smarter they will cost more and more. And not only does the price of new cars increase but also that for assistance services which, between 2015 and 2020, according to the Autopromotec Observatory, grew by 6%, against an increase in consumer prices of 2.7 %. Also in this case the cause is to be found in the growing technological complexity of the new generation cars, which has forced the sector to invest in increasingly sophisticated equipment and highly specialized personnel training.
Each car currently has around 200 sensors on board, representing an annual use in the automotive industry of around 22 billion sensors. All this translates into a global microchip and semiconductor market in the automotive sector that has now exceeded 4 million dollars and is constantly growing. According to Deloitte, it will reach approximately $ 12.6 million by 2027 with an annual growth rate of 14.2% from 2020 to 2027.
The problem is that the world‘s leading microchip producers are in Asia and this makes the European automotive industry even more exposed on both the price and supply fronts. This is clearly demonstrated by the current shortage of supply linked to the consequences of Covid, which has forced the main car manufacturers to cut models and production. A weak situation that the EU intends to overcome by supporting European production with 50 billion in investments, to reach 20% of world semiconductors by 2030.
In the meantime, however, other technological solutions capable of lowering the cost of on-board technology could also come to the rescue. Such as the new 4D Imaging Radar-on-Chip (RoC) developed by Israeli company Vayyar and ready for production, which offers the world‘s first multifunctional platform capable of replacing up to seven sensors and simultaneously supporting multiple applications with a single chip . An evolution that, by cutting costs, will allow even the cheapest cars in the future to take advantage of the same driving assistance systems now available on high-end cars.
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