Summary
- A “software-defined” vehicle can receive fundamental upgrades through software, rather than just new parts. It’s likened to the way smartphones change with new OS updates.
- SDVs offer benefits for both drivers and manufacturers, but could lead to even more subscription fees in the future, at least if you want the best possible driving experience.
- Various factors may be hampering their growth, including re-engineering work, software development costs, and the higher upfront prices for any EV.
The auto industry is changing dramatically. I’m sure I don’t need to tell you that, but there’s more going on than the transition to electric vehicles. Or rather, because of that transition, automakers have been rethinking many aspects of how a car should function. Some cars now have cockpit-style heads-up displays, for instance, or all-LCD instrument clusters. You may be able to unlock and start your car simply by carrying your phone with you, and the holy grail is a fully self-driving product — one that doesn’t gnarl up Austin traffic, that is. We’re not there yet, despite Elon Musk’s wild plans for the Robotaxi.
If you’ve been following auto evolution, you’ve probably seen the term “software-defined vehicle” pop up at some point. But what does that term mean? Can you buy one today? All I know for sure is that by the time I buy my next EV, it’s likely to fall into that category by someone’s definition. The same may be true for you, as well.
What is a software-defined vehicle?
Brace yourself for more subscriptions
If you take the term literally, you might be thinking that software-defined vehicles (SDVs) have been around since the 1990s, if not earlier. There is, after all, software required for any chip running under the hood or in your dash display. Certainly it feels a little absurd to exclude more recent cars with touchscreen controls and support for Apple CarPlay or Android Auto.
What automakers really mean, however, is a vehicle that can be fundamentally altered via software updates, instead of necessarily having to swap parts out. The concept is sometimes likened to a smartphone on wheels. Yes, my iPhone 16 Pro is inherently faster than an iPhone 13 Pro Max, and equipped with better cameras — but if you update the older phone from iOS 15 to iOS 26, it’s still going to gain much of the same functionality.
Cynically, SDVs may open up opportunities for automakers to exercise more control, possibly with additional subscription fees in mind.
There are a variety of potential benefits to SDVs. For drivers, their cars might not only feel “fresher” for longer, but genuinely better than when they first got them. For automakers, it’s a value-add that can keep products relevant without having to overhaul design and production. It can even alter performance, for instance enhancing battery management, or how well self-driving modes deal with complex situations. As a fun sidebar, there’s a similar thing at play with PEVs like electric unicycles — a single firmware update can radically alter how a wheel feels under your feet.
Cynically, SDVs may open up opportunities for automakers to exercise more control, possibly with additional subscription fees in mind. Imagine more subscriptions like Rivian’s Connect+, which covers not just a cellular connection, but features you might assume would be free — like “priority” software updates and Google Cast support.
Can you buy a software-defined vehicle right now?
A logical question with a complex answer
Sort of. Arguably, the company that pioneered the concept was Tesla, which has long relied on proprietary software, over-the-air software updates, and giant touchscreens that replace many gauges, knobs, and dials. Tesla owners are used to the functionality of their cars evolving over time, if occasionally marred by glitches.
Other automakers have since gone down the same path, most notably Rivian. Just recently, in fact, that company replaced its own navigation solution with Google Maps, solving long-standing complaints from customers. And you don’t need to own a Gen 2 vehicle to get the app — a 2022 R1T Gen 1 can run the software too.
That said, even Teslas and Rivians don’t meet the definition of an SDV by some standards. They don’t have app stores, and later iterations have dramatic hardware-only upgrades. The R1T Gen 2, for example, adds things like a heat pump, a better regen braking system, and different motor configurations. The Gen 1 continues to be a fine truck, but there’s no denying that a newcomer is going to have a better experience. Personally, I think it’s unreasonable to expect hardware upgrades to slow down anytime soon.
What’s holding software-defined vehicles back?
Dreams, meet the real world
Software can be as much an obstacle as it is a solution, at the moment. Cars have to be engineered with SDV adaptability in mind, and if you want a smartphone-like experience, you have to design, code, and test a smartphone-like operating system, which means hiring a large software team. You can’t even rely (completely) on platforms like CarPlay Ultra or Android Automotive, since those don’t get close to the metal — the most they can do is toggle things like the radio and air conditioning. CarPlay Ultra won’t work at all without an iPhone present.
Then there’s the matter of fragmentation. As of early 2024, there were 15 different automotive operating systems on the market, and there are probably even more today. It’s impractical for all but the largest app developers to support that many platforms, so it’s no wonder some cars have conspicuous gaps in their preloaded app catalogs.
Tesla-style SDVs do seem poised to become commonplace in the long run, given their profit potential if nothing else.
Worse, an SDV is liable to be more expensive, reducing its appeal to shoppers. The biggest cost is an all-electric powertrain, naturally, but that can be amplified by things like dash-spanning LCD panels, and building as many components to be software-linked as possible. If only a minority of people are buying SDVs (or SDV-likes), there’s less incentive to churn them out, creating a Catch-22 — ramping up production would force prices down.
Tesla-style SDVs do seem poised to become commonplace in the long run, given their profit potential if nothing else. The real question may be how quickly car buyers will get onboard, considering not just the inherent costs, but the Trump administration’s tariff war, and growing subscription burnout. I dislike being nickel-and-dimed for cloud storage, much less the prospect of updating my car. I’d rather go back to putting my phone in a window mount.
