Continental CEO Nikolai Setzer says the company plans an expansion of software development (picture alliance/dpa)
German car supplier Continental plans to expand its software development activities in the coming years, even though carmakers are also making ambitious plans in this area, according to its boss. "The complexity of software content will continue to increase exponentially," chief executive Nikolai Setzer said.
The market is big enough for several suppliers and carmakers, he said. He also referred to a significant part of standard software where it is difficult for carmakers to stand out from one another, saying only at the "tip of the iceberg" were differences perceptible between brands.
"That which lies below, for example the connection to the cloud or basic operating systems, is still one of our core competences," Setzer said.
Continental wants to change from being a supplier of car parts to focusing on developing software and electronics for the automotive industry in the years ahead, in a transition that will see the elimination of thousands of jobs in more traditional areas by the end of the decade.
The change will also see new jobs created in other areas, such as software, however. Carmakers such as VW, BMW and Mercedes-Benz are also creating and developing their own software, seeking to offer customers individualized products.
As the car market develops vehicles that are linked digitally, Continental is creating more space for its own software activities within its newly-organized supplier division. Industry observers expect the growth of digitally assisted driving will significantly increase the amount of programming and coding involved in the sector.
Setzer was not unduly concerned about carmakers moving to establish ties to chip makers directly, circumventing suppliers, amid a global shortage of semiconductors.
He said Continental had the advantage of a broad market reach, as a major buyer of semiconductors, allowing the company to balance out the capacities available more efficiently with chip manufacturers.
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