Little by little, Google is gaining a foothold in the automotive industry. The American giant has been developing software to be implemented in cars for some time and, for this reason, it is also in talks with different manufacturers. Now, Mercedes joins this long list.
As reported ReutersMercedes has partnered with Google on navigation and now will offer “supercomputer-like performance” on all cars with automated driving sensors. With this jump, it hopes to compete with Tesla and the new cars coming from China.
As detailed by the German brand, this collaboration will allow offer traffic information and automatic diversions in their cars. In addition, through their screens, drivers will also be able to watch YouTube on the car’s entertainment system when the vehicle is parked or in autonomous driving mode.
All vehicles on Mercedes’ upcoming modular architecture platform will also feature so-called hyper-displays that will span the entire cabin of the car.
But Mercedes is not the first company to reach an agreement with Google. Other automakers like General Motors, Renault, Nissan, and Ford have integrated a whole suite of Google services into their vehicles, offering features like Google Maps, Google Assistant, and other apps.
In the war that manufacturers are maintaining to match and surpass Tesla in terms of electric cars, where Elon Musk’s company is a pioneer, Mercedes has decided to start taking steps forward.
In addition to its alliance with Google, the German manufacturer has also announced that it has agreed share your income with Nvidiayour partner in automated driving software since 2020, to reduce the initial cost of purchasing expensive high-power semiconductors.
“You just have to pay for a heavily subsidized chip, and then figure out how to maximize the joint revenue,” says Ola Kaellenius. In addition, the manager reasons that sunk expenses will be loweven if the drivers don’t enable all the features that the chip allows.
However, the higher features offered by the cars, i.e. Lidar sensors and other hardware for level 3 automated driving, will only be available for customers who pay for that optional package. These benefits “have a higher variable cost,” according to Kaellenius.
Mercedes has also struck a deal with autonomous driving sensor maker Luminar Technologies to integrate its sensors into a wide range of its vehicles by mid-decade.
All these agreements are part of a strategy that Mercedes has been working on for years. The goal is to move from a patchwork approach that integrated software from a number of vendors to controlling the core of its software and bringing in partners.
In 2022, it generated more than 1,000 million euros of software revenue and expects this figure to exceed 1,000 million euros in 2030once you’ve rolled out your new operating system MB.OS in the middle of the decade.
This is a more conservative estimate as a proportion of total revenue than has been submitted by other companies such as Stellantis and General Motors. “We take a prudent approach because no one knows for sure what the size of that potential gold hole is right now,” Kaellenius concludes.