Is It Time to Rebrand ‘Recall’?

Conventional understanding and thinking around repairs, service and upgrades is changing for millions of consumers and the OEMs that sell to them.

David Kelly

February 15, 2024

5 Min Read
5G cars image (1)
Software-defined connected vehicles significant advance in automotive technology.

In late 2023 and early 2024, Tesla issued three separate recalls in the U.S. and China, accounting for almost 4 million vehicles. While recall action on this scale is not out of the ordinary, in the past it would have presented a significant and costly multi-market challenge for a manufacturer and its dealer network.   

But Tesla’s recent case is different. The vast majority of these “recalled” vehicles didn’t need to leave their owner’s driveway to have the issue addressed; the fix was delivered by an Over-the-Air (OTA) software update. For today’s modern software-defined vehicles, OTA updates can fix many safety and performance issues without the need for the driver to take any action or suffer any inconvenience themselves. 

By 2030, McKinsey estimates 95% of new cars sold globally will be connected. OEM revenues from automotive software and electronics will grow nearly threefold between now and 2030, from $87 billion to $248 billion, according to a BCG analysis of SDV growth, with the supplier market for automotive software and electronics set to nearly double.

BYD and its major BEV market presence is gearing up for its own SDV future and incumbent OEMs are infusing connectivity into their fleets and huge distribution networks. All this means we are at a point where conventional understanding and thinking around repair, service and upgrade is changing for millions of consumers and the OEMs that sell to them.

Consumers, OEM Ecosystems Aligning Around a New Future

How does this change things in practical terms, as well as the way we understand and relate to our vehicles? One of the fundamental points of value around modern cloud software is its ability to regularly update itself – whether adding new tools or features, delivering a new or improved user experience, or in addressing issues big or small. That’s increasingly a normalized experience, both in the everyday software and apps we use for messaging and social, and the enterprise-grade systems used to run the world’s most complex businesses. 

Perhaps, as software becomes the beating heart of all new vehicles, the time will come to stop applying the blanket term “recall” itself for OTA updates. Instead, we can hold that term for physical vehicle recalls alone to better reflect the changing nature of automotive technology. Safety is paramount and not all potential safety concerns hinge on software-fixable issues – the interface between software and “hardware” components can’t always be decoupled, after all. But we will increasingly become exposed to, and comfortable with, OTA updates and fixes, as opposed to dealer visits.

Beyond this, buyers stand to benefit from vehicles that can receive highly visible and useful new features and functionality over their lifetime, and a vehicle lifetime itself that we can start to think about differently. And that increasingly matters to a new buyer audience; recent research shows that in some markets, 40% of car buyers are willing to change brands for better connectivity features. This focus on software, not hardware, means manufacturers can increase the value of a vehicle or device by adding new functionality over-the-air for safety, comfort and performance. 

Connectivity Crucial for Safe, Customer-Centric Experiences

The future of SDVs hinges on connectivity as the key foundation for internal and external ecosystems. That’s why we refer to software-defined connected vehicles as a category term when talking with our customers and partners. Its anchoring role isn’t just confined to enabling OTA feature updates and safety fixes; connectivity gets to the heart of how SDVs add real value, providing a bridge to delivering innovation and revenue opportunities and playing a vital role in ensuring vehicle longevity.  

Real-time data and analytics, performance monitoring and alerting, and AI all underpin crucial insights relating to vehicle performance, user behaviors, preferences and more. To enable this new world, OEMs need an easy way of connecting SDVs no matter where they are in the world so they can be digitally enhanced. However, delivering and maintaining robust, reliable connectivity is no simple task. It is rooted in technical complexity and regulation – for instance, in delivering cross-border connectivity, especially across patchwork geographies such as Europe. Take data roaming as an example: Without OEMs having agreements in place, the consistency of service and customer experience are severely compromised.

David Kelly-headshot.jpg

Updates, “recalls” and fixes are visible and key – but if manufacturers can’t tackle connectivity challenges to deliver a deeper, consistent customer experience, they risk missing out on a lucrative opportunity. Most buyers rightly don’t want or need to understand underlying vehicle technology; they just want cars that are more engaging, safer, easier to diagnose and fix, and work as part of their digital lives – just like the marketing promised them. SDVs hold huge potential, but not delivering consistently on those expectations, as millions more buy and share their experiences for the first time, risks damaging consumer experiences and trust.

David Kelly (pictured, above left) is Chief Corporate Officer of Cubic Telecom.

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