Fragmented Regulation Challenges Automotive Industry’s Shift to Connected Vehicles
The automotive industry’s move to connected vehicles faces challenges from fragmented regulatory standards in the EU, prompting industry efforts to simplify compliance and ensure cybersecurity.
- • One billion connected vehicles expected within five years, shifting focus to cloud connectivity.
- • Fragmented EU regulations like NIS2 and EECC complicate compliance for manufacturers.
- • Telenor IoT provides solutions to help navigate regulatory frameworks.
- • Stellantis recalls 320,000 vehicles in US due to battery fire risk, illustrating ongoing industry challenges.
Key details
The automotive sector is undergoing a profound transformation with projections of one billion connected vehicles globally within five years. Mats Lundquist, CEO of Telenor IoT, highlights that the industry is now shifting focus from traditional horsepower to cloud connectivity, driven by evolving consumer demands for enhanced internet services in vehicles. Research cited by Lundquist indicates that approximately half of electric vehicle buyers would switch brands for better connectivity, underscoring the importance of integrated software and service offerings in maintaining customer relationships throughout the vehicle lifecycle.
However, this advancement faces significant regulatory hurdles. New EU laws, notably NIS2 and EECC, increase cybersecurity and data storage requirements for manufacturers but present challenges due to fragmented and inconsistent interpretations across member states. These diverse compliance standards complicate manufacturers' efforts to navigate and meet regulatory obligations, potentially slowing innovation and deployment of connected vehicle technologies.
Telenor IoT is addressing these challenges by investing in regulatory expertise and introducing solutions like IoT Drive, aimed at simplifying compliance processes for vehicle manufacturers. Additionally, Telenor IoT has published a regulatory guide to help the industry understand European digital service regulations. Lundquist emphasizes the necessity of collaboration among telecom providers, automakers, and regulatory bodies to harness the full potential of connected car technologies and secure the industry's future growth.
Separately, the automotive sector continues to grapple with safety concerns, as illustrated by Stellantis’ recall of 320,000 hybrid vehicles in the US due to battery fire risks. While this recall is geographically focused in the US, it reflects broader industry challenges linked to complex technology integration and regulatory scrutiny.
Overall, the transition to connected vehicles is shaped by escalating consumer expectations and regulatory complexities, highlighting a critical need for coordinated strategies to ensure compliance without hindering innovation.