4 Key Takeaways from CES 2025: Cars Aren't Cars Anymore

Welcome to Issue #50 of The German Autopreneur!

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Now, let's dive straight into what matters:

CES just wrapped up in Las Vegas. Over the recent years, it has evolved into one of our industry's most crucial events. This is no coincidence.

A few weeks ago, I shared my thoughts on the auto industry's iPhone moment. My thesis: Electric vehicles aren't simply cars with electric motors. They represent an entirely new product category. Just as the iPhone wasn't merely a better phone.

The response sparked intense debate. Many disagreed with my view. Their argument? A car's primary purpose will always be transportation.

CES 2025 now proves it: The iPhone moment is real.

Here are my 4 key takeaways from the show that demonstrate why:

1) AI (and NVIDIA) Define the Car

NVIDIA seems omnipresent at CES. It's now the world's largest AI company and second-largest overall. And its automotive footprint keeps growing.

Their technology drives virtually everything new. From smart cockpits to robotaxis.

NVIDIA chips and software form the foundation for many autonomous vehicles. Whether it's Tesla, BYD, Uber, or Continental – everyone needs NVIDIA. Another proof: Toyota just chose NVIDIA to power their next wave of autonomous cars.

The big suppliers are jumping on board too. Bosch now employs 5,000 AI experts and aims to generate around €6 billion in revenue from AI solutions by 2030.

2) Software Is the New Spaltmaß

In Germany, Spaltmaß (panel gap) has long been the gold standard of automotive quality. The precise spacing between body panels that German manufacturers perfected. But today, a new standard of excellence is emerging: software.

For decades, one equation defined cars: Horsepower + Hardware Engineering = Success. That era is over.

Here's how a Honda executive explains their new approach:

"We used to start with the car and add software later. Now we start with the software platform and design the car around it."

And remember: This comes from Honda - a company known for its conservative approach.

3) Your Car Becomes a Smart Device

Drivers are becoming passengers. When cars drive themselves, entertainment becomes more important. That's why cars are evolving into mobile living spaces. For work, entertainment, and leisure.

Getting from A to B is still essential - but it's no longer a differentiator. Every car can do that well. The new cars are digital devices that integrate seamlessly into our lives:

• Sony and Honda's Afeela integrates a PlayStation 5

• BMW's Panoramic iDrive projects information across the entire windshield

• The Zeekr RT (for Waymo) transforms between a mobile office and rolling lounge

4) A New Product Category Emerges

CES proves it: The EV isn't just a car with an electric motor – it's an entirely new product. A tech device showcased at CES alongside smartphones, smart TVs, and smart home devices.

Walk through a mall in China and you'll see exactly this: Cars are sold in Xiaomi or Huawei stores. Next to smartphones and vacuum cleaners. As an integral part of their respective digital ecosystems.

The iPhone Moment Is Real

The response to my iPhone moment analysis reveals something interesting: We're having trouble accepting this shift in perspective. Many resist this new reality. Cars are for "getting from A to B."

Let me try to make this more tangible. The car is a smart device defined primarily by digital features:

• Regular new features via updates (that you don't even notice)

• The best AI for autonomous driving

• Seamless integration with your smartphone, watch, smart home

• Access to all your data: emails, credit cards, calendar, messaging apps

• An OS that works perfectly with your smartphone

• All apps you use daily (yes, we need YouTube, Netflix & Co in cars)

• Unlimited 5G – for office, streaming, shopping & autonomous driving

• And most importantly: no annoying bugs, waiting times, or trips to the workshop for software fixes

Individually, all this might seem trivial. But together, these elements define your car's user experience. And thus, purchase decisions and customer satisfaction.

Traditional automakers often dismiss these features as "unnecessary gimmicks." But customer expectations are evolving rapidly. What seems optional today will be essential tomorrow.

The evidence is compelling: Cars are becoming smart devices. Transformation is unstoppable. The iPhone moment is real.

🔗 Sources

That's all for today.

Feel free to reply to this email with your thoughts.

Until next week,
— Philipp

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