Auto Makers Losing Battle for Dashboard Apps – Wall Street Journal
After several years of building its own software to connect mobile apps in its cars, Hyundai Motor Co.
is throwing in the towel, becoming the first global auto maker to embrace software from potential rivals Apple Inc.
and Alphabet Inc.
It may not be the last, according to drivers and industry researchers. New car buyers are asking for vehicles that have Apple’s CarPlay and Alphabet’s Android Auto, which control the dashboard displays now providing drivers with information and entertainment—and perhaps future revenue from purchases.
CarPlay and Android Auto only recently have been installed by auto makers, but could be in 80% of new cars sold by 2022, says researcher IHS.
Autotrader.com, an auto website, says 44% of its customers surveyed would pay $1,499 more to get a car with CarPlay or Android Auto.
Tyler Theilken, 24 years old, of Springfield, Ill., recently installed Apple’s CarPlay in his Jeep Wrangler using an aftermarket Alpine Electronics Inc.
system. Fiat Chrysler Automobiles
NV, which owns the Jeep brand, offers its own rival “UConnect” system, and Mr. Theilken has used Ford Motor Co.
’s rival Sync system.
“I don’t see how any in-car system could be better,” he said of CarPlay. “I think one day, those [auto maker systems] are going to be gone.”
Car makers are loath to give up the key information and entertainment links in their vehicles, hoping to turn dashboard technology into a reason for buying their vehicle and potentially to earn revenue by selling information and mobile connectivity.
As a result, many auto makers continue to spend big money working on their own systems, even as they increasingly offer links to Apple or Google’s systems alongside their own. General Motors Co.
and Honda Motor Co.
, for instance, recently started installing CarPlay as an option in new vehicles, and both say the software is well received. Android Auto is coming soon for their newer models.
Jay Guzowski, a senior product manager at American Honda, said the company can’t give up on its own system, called HondaLink. “Not everybody has an Apple or Android phone or they aren’t interested in using that environment,” he said.
Other car makers, including top global seller Toyota Motor Corp.
, are largely avoiding Silicon Valley’s tech giants and rely exclusively on their own systems to maintain the most direct link with customers.
In part, Toyota and others say Apple and Google systems aren’t the right fit for every buyer. Not everyone owns a smartphone capable of linking to CarPlay or Android Auto, and the third-party systems can’t be used in every market.
In countries including China, the modified Android operating systems used in phones won’t work with Android Auto and Apple’s iPhone isn’t as widely used as it is in Europe and the U.S. In addition, the Apple and Android systems don’t typically link to the buttons on a car’s steering wheel, or function well in areas with poor mobile phone reception. The systems also don’t connect to the auto’s heating and air-conditioning.
Potentially handing troves of driver and driving-data to Apple or Google also presents red flags, and has ignited debate among auto executives.
“We are competing for mind-share inside the vehicle,” said Don Butler, Ford Motor’s director of connected vehicles. The Dearborn, Mich., company first released its Sync system, which runs apps, sends texts and receives messages through voice activation, in its 2008 model year cars.
Ford developed an open-source language for apps that it is trying to convince other auto makers to use so that car companies don’t have to each develop their own connection to popular online music services, such as Spotify and Pandora.
There is evidence auto makers face a tough sell to keep customers from defecting to rival systems. CarPlay and Android Auto’s voice recognition, which rely on cloud-based computing, can make retrieving driving directions, using phone functions or asking for music selections easier.
California research firm J.D. Power and Associates’s June survey of new car buyers found the greatest complaints involved vehicle connectivity systems. The auto makers’ voice recognition and Bluetooth pairing were top concerns, it said.
“Over the last five years, a lot of these auto makers have spent a lot of blood, sweat and tears developing their own system, with their own brands and that’s threatened” because of customers preferring to use their Apple and Google smartphones, said Mark Boyadjis, senior automotive analyst with IHS Automotive.
Hyundai, which has a research and engineering center in Silicon Valley, agrees. “Basically what we’ve found is that it is very hard if not impossible to keep up with just the music apps that consumers want,” said Cason Grover, a manager in technology planning for Hyundai’s U.S. arm. “When you have got solutions like Android Auto and CarPlay, they can just go to them.”
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