Autonomous Cars: Lots Of Players In The “Driverless” Seat

Autonomous cars are a hot play on Wall Street these days, with big names like Tesla Motors, supplier Mobileye, and Google parent Alphabet getting top billing. However, the supply chain for autonomous cars is arguably more diverse than the supply chain for traditional cars as we’re dealing with many more high-tech components.

Diversity in the autonomous cars supply chain

Hundreds of companies and thousands of different products are part of the supply chain as it takes some extremely niche expertise to build autonomous cars. Research firm Vision Systems Intelligence shared the below infographic with ValueWalk which shows that the chain is made up of companies ranging from major technology heavyweights through new startups, in addition to traditional automakers and their suppliers.

“No one company owns all the expertise necessary to build an autonomous vehicle,” explained Vision Systems Intelligence Founder and Principal Phil Magney. “From low-level component suppliers to modules or systems, each domain is a highly complex field in itself. Building an autonomous vehicle requires so many disciplines that most companies have no choice but to source IP from numerous players.”

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Companies position themselves for the autonomous cars market

Magney noted that there’s been a lot of mergers and acquisitions within the market as companies look at their portfolios for the purpose of best positioning themselves for the future. For example, he explained that in some cases, technology that was once targeted at advanced driver assistance systems (ADAS), is now being targeted at solutions for autonomous cars, particularly at the Tier 1 supplier level.

However, he added that it’s a “huge leap” to move from Level 1 applications to Level 3 or 4 because Tier 1 suppliers are uniquly positioned within the supply chain “because they represent the mechatronics side of automation where the mechanical world meets the digital world.” His firm pegs the number of companies involved in manufacturing autonomous cars at more than 600, but researchers included about 125 of them in their infographic because they’re considered to be “leaders in their space for the clarity in their value proposition, diversity of product, or market presence.”