MobileEye has a new rival, Veoneer and Qualcomm join forces

Recently, Veoneer and Qualcomm have decided to jointly develop scalable advanced driver assistance systems (ADAS), collaborative and autonomous driving solutions supported by Veoneer's next-generation perception and driving strategy software stack and Qualcomm Snapdragon Ride platform portfolio. The range covers L1 to L4 driver assistance systems, aiming to create an open platform for Tier 1 suppliers and automakers. The two parties have signed a non-binding letter of intent and expect to complete the final agreement in the second half of 2020.

This news reveals that the game between semiconductor companies, middlemen and automotive OEMs on AV-stack and SoC platforms has never stopped. In fact, as independent automotive industry analyst Egil Juliussen said, Covid-19 may have promoted further restructuring of automotive industry alliances.

Qualcomm President Cristian Amon and Jan Carlson, CEO of Stockholm-based Tier 1 company Veoneer, unveiled the partnership, which will combine a “perception and driving policy stack” developed by Veoneer with Qualcomm’s Snapdragon Ride platform for ADAS and autonomous vehicles.

While the companies were mum on the call about competitors by name, two things stood out in the changing AV market.

First, the Veoneo-Qualcomm team has set its sights on Intel's mobile eye.

The two companies claim that their solution will be a “true alternative” to the incumbent supplier (i.e. Mobileye) because it provides an “open system” to Tier 1 suppliers and OEMs. Mobileye’s solution is a “black box” with little room for the bottom-level guys to make changes or build inside the box.

Second, Veoneer is ditching Nvidia and turning to Qualcomm.

Veoneer CEO clarified the company's commitment to Qualcomm's SoC platform. When asked if the partnership was exclusive, Carlson said, "We are not planning to enter into any other SoC partnerships. We chose Qualcomm."

Veoneer’s past relationship with NVIDIA is no secret. Two years ago, Veoneer and ZenAcuity (a 50/50 joint venture between Veoneer and Volvo Cars) launched a new development board called Zeus. Veoneer is responsible for the development of the hardware and basic software, while ZenAcuity is responsible for the development of the AV software stack and full vehicle integration. Zeus is based on the scalable architecture of NVIDIA DRIVE AGX Xavier and runs the NVIDIA DRIVE OS operating system.

Given Zenuity’s experience, Juliussen explained that Veoneer is a small Tier 1, but not a new developer to the AV stack.

Juliussen also noted that Veoneer and Volvo spun off Zenuity this year. The split of Zenuity was completed just last month. At the time, Veoneer noted in its news that "as part of the split, Veoneer obtained intellectual property licenses," strengthened its own software and systems team, and about 200 software engineers left Zenuity to start a business and join Veoneer. The report stated that Veoneer "expects to save $30 million and $40 million per year." Juliussen speculated that the epidemic may be the reason for the split of Zenuity.

Qualcomm's victory

In conclusion, Juliussen believes that the cooperation between Veoneer and Qualcomm is a "win-win" for both parties. However, he emphasized that ADAS "is only part of why Veoneer is a positive for Qualcomm." More importantly, Veoneer is a Tier 1 manufacturer "with strong strength in safety systems," which "will give Qualcomm better access to OEMs and make it easier to expand in the future autonomous driving field."

“While Qualcomm hasn’t made significant inroads into automotive, they have been a player in telematics and are well positioned to dominate in V2X,” observed Phil Magney, founder and principal advisor at VSI Labs. “Beyond that, Qualcomm hasn’t made much of a play in ADAS and AV.”

In Magney's view, their "cooperation with Veoneer is a necessary condition for Qualcomm to achieve a breakthrough." After all, no chip company in the market currently has the resources to build the final platform. "In terms of ADAS, Veoneer has already gained the public's trust."

Mobileye's rival is coming

A recurring theme among Veoneer and Qualcomm is that they will provide a “true alternative” to Mobileye to Tier 1 suppliers and OEMs in the first half of 2023.

But what will the two companies need to do to convince other companies or OEMs to work with them instead of Mobileye, given that the Israeli company is much deeper in the ADAS market than any other chip supplier?

Magney: “Honestly, there are a lot of alternatives to Mobileye out there. They all advocate openness. What they need to do is prove that their solutions are just as effective as Mobileye’s solutions.”

According to Magney, Qualcomm realized it didn’t have the expertise to build algorithms beyond the perception stage, so it sought out Veoneer for a partnership. The two companies “mentioned driving policy as a key area. Combined with Veoneer’s ability to integrate automotive quality standards, Qualcomm seemed to have a springboard.”

Magney said the Qualcomm and Veoneer teams "need to support the scalability of their platforms, as well as their tool chains."

At this point, Toyota and Mercedes are the only OEMs not equipped with Mobileye ADAS solutions, so who will Veoneer/Qualcomm turn to?

That’s the problem, Juliussen acknowledged. “Mobileye is so entrenched in current systems. We have to target the next generation of systems. ADAS is moving to domain ECUs, where individual ADAS ECUs are consolidated to save cost, space and other advantages. This will be an opportunity for Veoneer/Qualcomm.”

The ADAS game is not over yet

Magney insisted that while many companies use Mobileyes’ EyeQ chip for ADAS, “I don’t think it’s really being used right now. We’ve seen a lot of initiatives everywhere that show hedging against major partners.”

“There are a lot of projects still open for next-generation solutions. Qualcomm has good support in the automotive space right now, even though a lot of it is ‘connectivity-related.’ When you look at their partner ecosystem, it’s a pretty solid lineup, including QNX, Elektrobit, Trimble, Infineon, TomTom, and Green Hills, among others.”

Although neither Qualcomm’s Amon nor Veoneer’s Carlson mentioned GM during the call, it’s entirely possible that their first big ADAS design win could come from GM.

Qualcomm introduced its new Snapdragon Ride platform at CES this year, calling it "scalable" and saying it would focus on ADAS. At the CES press conference, Qualcomm also mentioned that General Motors is working with Qualcomm on ADAS, trying to prove that the world's largest mobile chip company has entered the ADAS market. However, apart from mentioning GM, Qualcomm has never detailed its ADAS deal.

Meanwhile, Veoneer is no stranger to GM. Earlier this year, Veoneer was named GM’s best supplier of the year, “one of 116 best suppliers from 15 countries that consistently exceeded GM’s expectations.” This is the second time Veoneer has received the award.

How good is Qualcomm?

Qualcomm's president called the collaboration with Veoneer "a very important milestone" for Qualcomm to provide "very competitive solutions" for the ADAS market opportunity.

As Magney points out, “It’s important to note that Qualcomm has been quietly building solutions for other automotive areas (not ADAS),” including infotainment, instrument clusters, and precise positioning. Mangey also mentioned Qualcomm’s announcement of a deal with General Motors as part of the launch of the Snapdragon Ride platform. “But not much is known about this project.”

“I don’t doubt that the Snapdragon architecture will enable efficient processing of neural networks in an embedded automotive environment, but I don’t know if there is anything unique that will differentiate them from other chipmakers. The Snapdragon Ride architecture looks great. Without the help of our VSI Labs, we would have no way of knowing how it would stack up against Intel, Nvidia, ARM, TI, or NXP.”

Regardless, this market will be critical to Qualcomm in the years and decades ahead.” He said Qualcomm’s “direction is the Internet of Everything, and we all know how important it is to maintaining AI-based driving applications.”

Veoneer's role

According to reports, Veoneer's software of this generation are all automotive-grade solutions designed to meet the requirements of global automakers, regulators, and rating agencies. The company "received the highest performance ratings and enabled automakers to obtain five-star safety ratings in the European New Car Assessment Program (Euro NCAP) in 2018 and 2020." "Veoneer and Qualcomm" plan to launch an advanced automotive-grade, functional safety-compliant optimized platform that will include a range of optimized NCAP features, up to hands-free driving on highways and slow-moving vehicles. The platform will continue to be upgraded through over-the-air updates," the two companies promised.

By partnering with Qualcomm, Veoneer will transform into a key technology supplier for the AV software stack (perception and driving policy) and be integrated into Qualcomm's Snapdragon Ride platform. Qualcomm will then sell the turnkey solution to tier 1s (including Veoneer's competitors) and automotive OEMs.

Juliussen expects Qualcomm's integrated hardware/software solution to become popular, "especially among Tier 1 companies" as they are in the business of developing products needed by automotive OEMs. If Qualcomm's solution is indeed the promised non-proprietary system, then Tier 1s now have the hope of customizing or building Qualcomm's solution.