Stout’s 2020 Automotive Defect & Recall Report is a wakeup call!

WHAT:

With software-related recalls on the rise, is it time to embrace predictive software maintenance?

WHY you should read this:

  • We highlight the main trends from Stout's 2020 report
  • We explore the significance of these trends: Software-related recalls and OTA updates
  • We dig deeper and explore what these trends mean for the industry
  • We question whether recalls are necessary or whether cars could be serviced remotely

Stout's 2020 Automotive Defect and Recall Report got us thinking about one of Elon Musk's tweets from 2013. In response to Tesla having to recall nearly 30,000 of its sedans because of a fire risk caused by the vehicle's charging equipment overheating, Musk tweeted: "The word "recall" needs to be recalled". And in this case, that's just what Tesla did by offering an over-the-air (OTA) software update instead of actually recalling the faulty vehicles. In many ways, this tweet was a watershed moment for the industry. And this idea of software-related recalls is echoed strongly in the latest Stout report.

As we find ourselves at the beginning of the new year, we thought it would be helpful to reflect on some of the main trends highlighted in Stout's 2020 report. Because reports like this set the stage for what's to come and in some senses hint at the bigger issues OEMs and suppliers may be forced to grapple within the coming year. The report highlights a trend we all know isn't going anywhere anytime soon and something that a relentless maverick and visionary like Musk already knew in 2013: That software-related innovation is going to play an increasingly important role in new automotive functionality, and that software-related recalls will not be far behind. The report clearly shows this trend.

But all this got us thinking: Could there be a better, more efficient way of dealing with software recalls? Perhaps it's time to embrace predictive software maintenance.

Change is in the Air: Key Trends and Highlights

In many ways Stout's 2020 Automotive Defect and Recall Report highlights what we already know to be true: Software-related recalls are on the increase.

The report highlights the fact that:

  • In 2019 we saw a significant increase in the number of software-related defects when compared to previous years: There was a ~ 10% increase in software-related defects from 2018 to 2019
  • Software-related recalls reached record numbers in 2019 with 2 of the largest recalls of the year (including a safety recall) involving software
  • An estimated 6.5 million vehicles that were recalled for electronic component defects received software remedies, making 2019 the year with the greatest number of software-based campaigns

Interestingly, the report also hints at the fact that while more and more manufacturers are warming up to the idea of OTA updates, they still aren't widely used (for the entire vehicle). We predict that this is going to change. In fact, from conversations we've had with several of our clients and announcements from various car manufacturers, we know this is changing. We predict that full-vehicle OTA updates will become increasingly popular as more and more manufacturers embrace the technology. And while this innovation will enable remote repair and may even lessen the load when it comes to recalls, we shouldn't stop here. We shouldn't just be striving to ease the load and make recalls more efficient but rather focusing on predictive software maintenance. This means being able to predict which software is causing the issue before it causes the vehicle to fail, and using OTA updates, we'll be able to fix it before any harm is caused.

Predictive Software Maintenance to the Rescue

The Stout report highlights the increase in software-related recalls and hints at the role OTA updates will come to play. But we'd argue it doesn't go far enough. Because of innovations like OTA updates, we see the emergence of a powerful trend: Predictive software maintenance. But what does that really mean? And what will this mean for the automotive industry?

Essentially, predictive software maintenance is a shift away from the tried and trusted reactive approach which only fixes problems after they have caused what often turn out to be catastrophic failures. This is unplanned, reactive maintenance and is how things have always been done (until now). On the other hand, predictive maintenance relies on real-time data and machine learning algorithms to detect anomalies and possible defects before they need fixing. Such an approach anticipates problems before they occur, making it more efficient and cost-effective.

According to our 2020 Automotive Software Survey, the ability to perform predictive maintenance on automotive software is a desired capability within the industry. Based on the survey, more than 88 percent of the 200 respondents think the ability to predict software anomalies is important or very important.

An example of predictive maintenance is a vehicle's brakes which tend to wear slowly over time. The garage does not wait for the brakes to fail before replacing the brake pads, but instead, the garage mechanic will use his experience to predict when they will fail and will suggest to replace them in advance. Line-Of-Code Behavior technology does the same for the vehicle software.

Line-Of-Code Behavior technology enables manufacturers to be proactive rather than reactive to software failures, enabling pre-error detection. This technology leverages machine learning algorithms to monitor the behaviour of the software functions over time and predicts when the software will fail. In addition, it detects the exact lines of code causing the problem, shortening the error-resolution time and giving the manufacturers the necessary time to fix, test and certify the software before it is released. Using OTA updates the new software can then be pushed to the vehicles seamlessly before the software has failed in the field, paving the way for a seamless continuous improvement process.

Conclusion

There are many takeaways from Stout's 2020 Automotive Defect & Recall Report. What stood out most for us was the significant uptick in software-related recalls. The report also hints at the increasing reliance on OTA updates. This shines a light on where the industry is headed. It also makes it clear that with the right technology and innovation, we could soon be servicing cars remotely instead of recalling them. For an industry so focused on recalls, this is a major wake up call and an opportunity to do better.

Learn more about our approach to predictive software maintenance.

Software – the king of a diverse device kingdom

The past has proven that companies' technology and innovations are versatile and just because the original intent of the technology or innovation was to solve one problem, as time goes by, and new challenges arise, the same solution can be used to solve other unforeseen problems.

As USA Today reported, in 1942, during World War II, the U.S. military was in need of a durable adhesive tape that could maintain its bond under harsh field conditions. The military asked Johnson & Johnson Co. to develop the idea and initially called it duck tape for its waterproof nature.

Civilians began to utilize the product heavily during the postwar housing boom, when it was used to seal central air and heating systems. Duck tape was used in ductwork so much that it was renamed to duct tape and recolored to match the silver metallic color of HVAC systems.

During the height of COVID-19, we saw examples of corporate agility as car manufacturers began building ventilators and sporting good manufacturers started sewing masks for the healthcare industry. We will continue to see this nimbleness moving forward as companies' technologies, originally scoped for one industry, find their way into processes supporting Industrial IoT - a term designating the efforts that bring together machines, cloud computing, analytics, and people to improve performance and productivity.

Aurora Labs' Self-Healing Software, currently being leveraged by automotive manufacturers, is a solution that is also bringing value to Industrial IoT companies. Aurora Labs uses artificial intelligence and machine learning to enable these companies to become proactive about the quality, safety and security of their connected devices and systems.

This is of increasing value for time-sensitive industrial IoT devices such as security cameras, autonomous warehouse robots, and production line machines that are required to have 24-hour uptime, 7 days a week, 365 days a year. Aurora Labs' unique Self-Healing technology is the predictive maintenance solution for software, enabling pre-error detection and remote OTA updates with zero downtime -- both key features in guaranteeing continuous quality, safety and security.

Business Insider quotes Maribel Lopez, founder and principal analyst at Lopez Research, saying, “Although Aurora Labs is targeted at vehicle manufacturers if Amazon Web Services (AWS) were to acquire it, its technology would not just be used for cars. Instead, it could be expanded as a platform play, meaning that AWS could use its AI technology for other parts of its business - its own growing logistics robot fleet, for example.

The global industrial IoT market is expected to reach approximately USD 751.3 billion by 2023, growing at a CAGR of 23.88% from 2017 to 2023. By component, the global industrial IoT market is segmented into hardware, software and service. Software is expected to be the fastest-growing segment during the forecast period, with a CAGR of 25.65%. Software plays a major role in the development of industrial IoT systems.

However, for this to happen, according to global consultancy firm Bain, "Device makers and other vendors of industrial and operational technology need to dramatically improve their software capabilities—not a historical strength for most of them."

The crossover from automotive to Industrial IoT is a natural extension of Aurora Labs' Self-Healing Software in support of various scenarios. In manufacturing alone, having the visibility into line-of-code behaviour to predict and fix errors in security, plumbing, lighting and production line systems will prevent downtime, which costs firms at least $100,000 an hour, according to a 2019 survey by ITIC.

A watershed moment for automotive over-the-air updates

A watershed describes an area of land that contains a common set of streams and rivers that all drain into a single larger body of water. History shows that for new technologies to be successfully deployed, there needs to be a watershed moment where everything from powerful chipsets, to advanced networks, standards and interoperating components need to come together at the same time to truly leverage the power of new solutions and change the way people live, work and play.

This reality was recently reported in The Wall Street Journal's Decade of Disruption supplement. In Joanna Stern's article, First the Smartphone Changed then Over a Decade, it Changed Us, she quotes AT&T's former Vice Chairman, Ralph de la Vega, saying "When one piece of technology changes, it's a big deal, but when two or three things change that are complementary at the same, it's really disruptive."

For the mobile phone industry, only when the network technology (3G), operating systems (iOS and Android) and the phones' processing power, battery life and storage capacity reached a tipping point did mobile phones become ubiquitous to our way of life with consumers watching videos, receiving mails, playing, shopping, banking and surfing online all from the computer in their hand. This watershed moment also made over-the-air (OTA) updates truly beneficial for smartphone users. At this point in time, all of the firmware and applications - the entire phone - could be updated and continuously maintained throughout the lifetime of the phone.

Once OTA solutions were ubiquitous within the mobile phone industry, the OTA vendors set their sights on the automotive market. The car became the next device to update. Today, most of the over-the-air updates are keeping the non-critical head unit, infotainment system and telematics control unit updated. With the exception of Tesla, that built their vehicle platform as a software platform from the ground up.

New technologies comprising today's watershed moment for software as the predominant technology in cars -- the technology rivers and streams that are aligning -- are electrification, 5G, computer vision and software solutions based on advanced AI and machine learning. This convergence will ensure that automotive manufacturers can update more than the head unit, infotainment system and telematics control unit. This watershed moment will result in the ability to run software diagnostics and updates for the safety of critical and non-critical components alike throughout the entire vehicle - end-to-end, bumper-to-bumper, hood-to-trunk, bonnet-to-boot.

This watershed moment also offers the opportunity for automotive manufacturers to redesign their entire E/E architecture and adopt new centralized systems that manage in-vehicle software components as micro-services, ensuring flexibility, cost savings, software quality, safety and security.

Who is liable?

Smart Summon is a new feature Tesla has installed with an over-the-air (OTA) update as part of its version 10.0 software. Smart Summon enables the car owner to summon his or her car from a parking space within 200 feet. A few days after the update was delivered, a video surfaced of a Tesla Model 3 being summoned from a public parking lot, driving through a stop sign and getting pulled over by the police.

The Tesla owner said to the police officer "I wasn't driving it. The car ran the stop sign. So, no ticket. "The police officer was understandably perplexed. Who should he issue the ticket to? The owner wasn't driving the car when it made the traffic offence? The car? Maybe Elon Musk himself?

In this instance, no harm came to any pedestrians or other cars, however, the question of liability remains. Earlier this year, executives from Ford and Bosch came together with executives from AllState and Nationwide as the two industries - automotive and insurance - work through how to insure connected and autonomous cars and figure out who is liable for what.

While in many cases the hardware and sensors may be to blame for a vehicle malfunction, according to a report from Stout, in 2018, nearly 8 million vehicles in the US were affected by software-based defects. This is a higher total than the previous five years combined and three times more than any previous year. Both the insurance and the automotive industries - which haven't had major changes or new business models in decades - are being disrupted with the ushering in of connected cars, autonomous cars and mobility services. Who is responsible when an autonomous car crashes? The 'driver' in the car? The owner of the vehicle? The vehicle manufacturer? The supplier of the autonomous driving technology?

Too often the question of liability is framed as a 'blame game' by either the regulators or the insurers, to find the entity that can be shouldered with the cost after the fact. However, the focus of liability should not be on pinning the blame but rather on taking proactive responsibility so that crashes do not occur in the first place.

Understanding of automotive software is going to be the difference between those automotive manufacturers that maneuver through and succeed in this liability storm. Software is entering the car from several entities - the automotive manufacturer's software; suppliers' software and software created from the open-source community. The goal of the vehicle manufacturer should be to ensure that there are technologies and solutions in place to enable transparency into which software is actually running in the car and how the software functions are behaving, to be able to understand the behavior of the software, to be able to detect software malfunctions and to be able to fix them before they affect the driving experience leading to a liability situation.

Connected cars, mobility services and self-driving vehicles are driving a dramatic rise in the amount of software in the car and promise a shift in vehicle control away from the driver and toward the vehicle. The same shift may occur in liability for harm caused by vehicle crashes and related events. Automotive manufacturers need to adopt new in-vehicle software management technologies and develop new business models to be prepared to take on the liability responsibility.

Engineering the software car

According to a recent Wall Street Journal article "The global auto industry thinks it sees the future, and it will require a transformation without precedent in business history: The giant industrial sector has to turn itself into a nimble provider of software and services."

This transformation started happening a few years back and is offering major opportunities for a certain segment of the population - the software engineer.

Right now, there are more than 14,000 automotive software job openings in the US alone, based on a very quick and unscientific search on the Indeed career website. The need for automotive software engineers is huge due to the fact that more than 1 billion lines of code are expected to be required to run a level 5 autonomous car. In this era, software engineers are in a position to be kingpins in the automotive industry.

The truly interesting bit is that new technologies, like AI and Machine Learning - technologies that are exciting for young and seasoned engineers alike - are cornerstone technologies in the realization of the autonomous car.  The jobs available to software engineers offer creative opportunities for the development of new driving and passenger experiences.

Aurora Labs is excited to be working with car manufacturers delivering Self-Healing Software for software engineers throughout the organization to succeed in this new automotive world.

With Self-Healing Software engineers can shorten development cycles, flash and test infinite variations of software configurations, and update the car guaranteeing the best user experience after the car has left the lot.