As car makers race toward new technologies, NXP Semiconductors N.V. announced plans to acquire TTTech Auto, an Austria-based leader in innovating unique safety-critical systems and middleware for software-defined vehicles (SDVs).
According to DealPulse’s M&A database, which harnesses both AI and attorneys to digest the granular deal points of publicly-announced transactions, the all-cash deal is valued at $625 million and will merge TTTech Auto into NXP Semiconductors’ Netherlands-based automotive processing and networking business.
“The automotive industry is undergoing a profound transformation, shifting from conventional hardware-based designs to platform-based SDVs with increasingly sophisticated, interconnected hardware and software systems,” according to the deal’s press release. “This transformation enables feature upgradeability, data-driven services, and native cloud development. The SDV market will expand to 45% penetration of global auto production in 2027.”
Source: Visual Capitalist
While automotive advancements have fallen short of the compost-fueled flying cars predicted by movies such as “Back to the Future” franchise during the 1980s, automakers have continuously sought to add technologies to set themselves apart from competitors. As the above chart depicts, advancements since 1960s have coincided with a precipitous drop in road fatalities as seat belts (1968) to airbags (1998) to backup cameras (2019) have become mandatory safety features.
Beyond safety measures, automakers have incorporated technologies to improve drivers’ experiences – and ultimately sell more cars. While cars of the 1980s and 1990s touted cassette players and simple cruise control conveniences, cars today have become “computers on wheels” that sync with drivers’ phones, provide internet connections for entertainment, and automated driver assistance systems. As the following chart depicts, luxury German car makers in particular have loaded certain models with an increasing number of technologies.
Source: The Next Web
These advancements are not without drawbacks, however. Some analysts point out, “Cars in the current generation can be pricier to repair, harder to understand and operate and, some experts in the field say, more likely to cause distraction and driver disengagement.” Further, watchdogs flag to the environmental and geopolitical effects of increasingly futuristic cars. Electric vehicles and hybrids rely heavily on rare earth elements and conflict metals for their magnetic, luminescent, and catalytic properties.
With China holding 70% of the world’s supply of rare earths, they elements have become a point of contention – and even driven the Trump Administration to seek purchasing Greenland due in part to its rare earth reserves. Despite these obstacles, companies such as NXP Semiconductors and TTTech Auto plan to forge ahead as they create the cars of the future.
