CES 2025: Germany watches and lags behind in software - only BMW shines
At the beginning of the year, the automotive world looks to Las Vegas for the Consumer Electronic Show. After the demise of the NAIAS in Detroit, CES has been one of the major auto shows of the year and the annual kickoff for the automotive industry for many years. However, the times when European CEOs were pictured with tech icons like Apple CEO Tim Cook or Nvidia CEO Jensen Huang and beamed into cameras after million-dollar keynote shows seem to be over. Instead, at CES 2025, most of the focus is on manufacturers from the USA or China. Every now and then, snippets of Chinese language buzz through the exhibition halls and casino hotels. Honda and Sony present details about their joint car, the Afeela 1, and Xpeng lets its manned flying drone, along with the corresponding car, shine in the gambling metropolis.
Strolling through the jam-packed halls of the Convention Center and the almost equally large Venetian rooms during CES, it is somewhat difficult to find the once so confident appearances of European, and especially German, car manufacturers. Audi, Volkswagen, or Mercedes – all of which used to be admired with large show stages in the Nevada desert, have once again little news to offer in the gambler's city. At least the US sub-brand Scout is allowed to present on the Central Plaza.
Only BMW stands out - and keeps up with the Panoramic eDrive
It's different a few meters away at BMW. The Bavarians don't offer a big entertainment show with Oliver Zipse and Arnold Schwarzenegger as they did years ago, but with the Panoramic iDrive, they enter the series communication of the new class in a distinctly digital way. At the end of the year, the new BMW iX3 will celebrate its public premiere, and its new display and control concept without a rotary push button is more of a daring leap than just a larger development step, as normal instruments at BMW will soon be a thing of the past.
"The new BMW Panoramic iDrive incorporates a quarter-century of pioneering and technological leadership in the operating concept," says BMW's Head of Development Frank Weber, "thus making one of the world's best and most comprehensive infotainment systems even more powerful and once again defining the industry standard in multimodal interaction."
BMW is still more of an exception than the rule. The restraint at CES 2025 shows that the transformation into the tech era, often proclaimed by German car manufacturers, is often more lip service, and there are significant barriers to setting themselves up for the future against competition from China. Brunswick, a shipbuilder, shows how to quickly follow words with actions. At CES 2023, a high-ranking Brunswick manager stopped by the booth of the software company Apex.AI and asked if they could use their software to develop a docking assistant to facilitate maneuvering in the harbor for captains. No sooner said than done. The teams came together, and a year later, the assistant, which performs highly automated and autonomous docking maneuvers, is ready. Even though a harbor basin is not as complex as automotive traffic, Apex.AI CEO Jan Becker misses this quick flexibility, especially in German car manufacturers.
Proven Patterns of Thinking Do Not Apply to Software
The proven patterns of thinking in the mechanical engineering and process-driven German automotive industry do not apply to software development. In the past, if something didn't work, simply assigning more engineers to the task would eventually solve the problem. When it comes to algorithms, digital parallel worlds, or artificial intelligence, increasing personnel initially seems counterproductive because the new employees tend to slow down and distract those already familiar with the project. In software, it is the quality of the developers that is crucial, not the quantity. Jan Becker is well aware of this, and he also criticizes the German regulatory culture. "I have yet to work in a country that is so heavily regulated, bureaucratic, and thereby stifles innovation in many key areas." Many European and specifically many German automakers have realized this, but contrary to contrary claims and new software centers, this has not truly been implemented at the grassroots level.
From Teutonic Masters to Students
For German automakers to compete with the Chinese or the US showpiece company Tesla in the "Software Defined Vehicle" sector, they must part with cherished habits. "We've always done it this way" is not always a guiding principle in the second decade of the second millennium in automobile manufacturing. "So far, the transformation pressure has been alleviated by markets like China, where automakers have reaped immense profits over the years, or by special effects like supply shortages following the pandemic," explains Jürgen Reers from the consulting firm Accenture. These were temporary phenomena, but one sometimes got the impression that German automakers had become comfortable in this situation. The reality often looks different: the pandemic is over, and the business situation in China has fundamentally changed. The Teutonic masters have increasingly become students, who are progressively finding themselves in a losing position in the struggle for market share.
"Now the transformation pressure is emerging unvarnished," summarizes Reers and adds: "The next two years will be crucial in determining whether this transformation can be managed."
In order to react as agile as a start-up and keep up with the increasingly rapid development cycles, it is not enough to place flexible workspaces adorned with a few green plants in an open-plan office in Silicon Valley and wear sneakers. The difficulty that German car manufacturers have with the necessary cultural change is demonstrated by the Cariad confusion, as Volkswagen tried to set up its own software workshop at great expense. The endeavor failed spectacularly, and VW invested up to 5.8 billion US dollars in the US auto start-up Rivian. Not least, to buy the software expertise. Image and time alike nosedived.
Car manufacturers must act like tech players
The know-how of US software experts is necessary to make VW fit for the future and the increasingly tough competition. “The development cycles are overlaid by sprints to bring new features to the vehicles in quick succession. Car manufacturers must act like a tech company,” emphasizes Jürgen Reers, who sees that something is indeed happening in the German automotive industry: “I see that the development process is being significantly shortened and that it is aligning itself with the cycles of Chinese car manufacturers, who develop a car in 20 to 24 months,” notes Jürgen Reers and at the same time encourages German carmakers: “The race is still open. Also in China!” The clatter on the brightly lit show stage is now more part of the craft than ever. This can best be seen in terms of tech scene and automotive IT in Las Vegas, where it has long been no longer said, “what happens in Vegas – stays in Vegas!”
Wolfgang Gomoll / Stefan Grundhoff; press-inform
Translated automatically from German.Elektromobilität , Newsletter Elektromobilität , IAA Mobility , SUVs und Geländewagen , Hybrid , Antriebsarten, Kraftstoffe und Emissionen , Oberklasse- und Sportwagen , Carsharing , Autonomes Fahren (Straßenverkehr) , Ladeinfrastruktur , Verkehrspolitik , Formel E , Brennstoffzellen , Fahrzeug-Vernetzung und -Kommunikation , Fahrzeuge & Fuhrpark , Automotive-Messen & Veranstaltungen , Pkw, Kompakt- und Mittelklasse , Minis und Kleinwagen , E-Auto-Datenbank, E-Mobilität-/Automotive-Newsletter, E-Auto-Tests