IoT in the Automotive: How It Works, Benefits and Examples

IoT in the Automotive: How It Works, Benefits and Examples

Table of Contents

If you are having difficulties imagining the possibilities of an Internet-connected car, then you're actually not alone. When speaking about the Internet of Things (IoT), this futuristic scenario is most common among people. That's why we've decided to collect the most innovative and useful IoT innovations, which exist right now among automotive companies and integrate them into cars of the present day.

In this article, we'll look at the types of changes enabled by the Internet of Things, as well as the potential challenges that the industry may face as cars become software-driven.

1. Understanding IoT In Automotive

Automotive IoT is the integration of devices, sensors, cloud computing, applications, and other components into cars to work as a sophisticated system for connecting cars, fleet management, OEMs, insurance, and other things.

The incorporation of the Internet of Things into the automotive sector enables manufacturers to introduce in-demand improvements that could potentially turn automobiles into nearly intelligent machines.

As embedded vehicle IoT systems mature, more complex enhancements will become available. Furthermore, the ability of linked car technology and the rapid development of mobile communications allow car manufacturers to keep introducing new and intriguing services, such as real-time location monitoring of the fleet, fully autonomous cars, object recognition systems, etc.

2. IoT in the Automotive Industry in Numbers

The market for electric cars is one of the most active in the clean energy sector. In 2021, the number of electric vehicle (EV) sales doubled from the previous year to reach a new high of 6.6 million. Only 120 000 electric vehicles were sold globally in 2012.

In 2021, the market share for electric vehicles was about 10% worldwide, up from just 2% in 2019. With this, there are now over 16.5 million electric vehicles on the road worldwide, which is three times more than there were in 2018. 

With 2 million electric vehicle sales in the first quarter of 2022, a 75% increase over the same time in 2021, the market for electric vehicles has continued to grow rapidly.

Here are some important insights from IEA Global Electric Vehicle Outlook 2022:

There are many variables contributing to the popularity of EVs. The main pillar is consistent policy support. Incentives and subsidies from the government for EVs increased by about 30 billion USD in 2021.

According to current policy plans indicated in the IEA Stated Policies Scenario (STEPS), EV sales will account for just over 20% of all vehicle sales in 2030, more than doubling the current stock to 200 million vehicles.

The IEA Announced Commitments Scenario (APS), which is based on recent climate-focused policy announcements and pledges, assumes that EV sales would account for more than 30% of all global vehicle sales in 2030. (excluding two- and three-wheelers). Even while it's remarkable, this is still far below the 60% share required by 2030 to be in line with a trajectory that would result in net zero CO2 emissions by 2050.

3. Benefits Of The Internet Of Things (IoT) For The Automotive Industry

The automotive industry has benefited greatly from the Internet of Things, both for producers and for consumers.

3.1 Improves control over driving

With IoT, drivers will be able to track their health as well as the status of the vehicle during driving, create positive driving habits and hold on to them. Thanks to On-Board Diagnostics solutions, you’ll be able to collect data from vehicle doors, windows, engine, and other elements of the car. It will be processed and stored as a comprehensive report with the list of your driving habits. The Internet of Things will be able to alert a driver if he’s over-accelerating, speeding, not using the seatbelt, or is about to hit a sharp corner.

3.2 Improves traffic management

Cities with a high number of drivers (Washington, DC, Los Angeles, etc.) have to deal with the traffic issue.

The Internet of Things is capable of improving traffic management by using sensors to control the traffic load in real-time.

This way, drivers can improve trip planning and the authorities will have data on the busiest areas in the city.

Using IoT for traffic management will help to reduce the number of car accidents and create a less polluted environment in highly populated areas.

3.3 A possibility to implement value-added services

IoT integration will allow drivers to make the driving process more meaningful and productive. The following are the main types of value-added services the Internet of Things can provide drivers with:

⚈ Improved navigation. The Internet of Things can improve the map accuracy of existing navigators, add a traffic status tracker based on V2V (vehicle to vehicle) technology, offering dining recommendations as well as the local speed limits.

⚈ Hands-free driving. IoT-empowered infotainment platforms allow drivers to steer IoT cars using voice commands or buttons.
Improved in-vehicle entertainment. IoT will become the cornerstone of new-generation musical solutions navigated by voice commands, scan a driver’s preferences and learn from them.

3.4 Reduced tracking and transportation cost for commercial vehicle owners

Fleet management is also likely to benefit from IoT adoption. The Internet of Things will allow vehicle managers to track the entire fleet in real time, report on drivers’ behavior, and ensure the delivery process is moving according to a manager’s plan.
The Internet of Things will also be able to control the contents of commercial vehicles. A set of sensors placed inside the vehicle will be able to collect the environmental data that’ll allow managers to ensure that the products a fleet delivers are stored in appropriate conditions.

3.5 User-based insurance

Using the Internet of Things, insurance companies will be able to adjust their policies based on a user’s emotional condition as well as his usual driving behavior. User-based insurance platforms will allow tracking the driver’s physical data during driving, his state of mind, and other psychographic factors.

IoT in automotive

4. How The Auto Industry Is Using IoT: 5 examples

While there’s still a long road ahead of the Internet of Things, there have already been more than a few IoT implementations in the industry. Let’s take a look at the projects that have already been considered successful.

4.1 Vehicle tracking

IoT offers immense opportunities for vehicle tracking. OBD sensors along with the GPS technology will collect the location data from inside the vehicle. All the information will be sent and processed in the cloud gateway so that a fleet manager can track the position of the vehicle and be alerted in case of safety issues.

There’s a wide range of IoT-based tracking devices. A tracking device developed by AT&T, for instance, provides developers with real-time fleet visibility and protects vehicles from theft.

4.2 V2X technology

V2X (vehicle-to-everything) is an IoT-based car communication system that allows the vehicle to collect real-time insights about everything around it. The technology allows drivers to have better control over their surroundings. As a result, the following opportunities have been created:

⚈ Real-time notifications about the proximity of parking lots and charging stands;

⚈ Sensor- and cloud-based communication between vehicles;

⚈ Road hazard warnings from several kilometers ahead;

⚈ Real-time traffic warnings.

⚈ Expanding road capacity with an automated highway system.

It is still impossible to ensure absolute safety on the roads. But the V2X approach is a big step towards that. The major car manufacturers are incorporating V2X technology into their new car models, so we will all be able to reap the benefits of the new technology in the near future.

4.3 In-vehicle infotainment

The leading companies in terms of IoT adoption have already started implementing their infotainment services into connected cars. Solutions from Google (Android Auto) and Apple (CarPlay) integrate your car into a single ecosystem with a smartphone and other smart devices. The on-board infotainment system becomes an extension of the smartphone, taking over all its main functions and helping to use them more easily and efficiently while driving.

By 'IoT-connecting' a smartphone to a vehicle, drivers will be able to spend their commuting hours more productively. With connected infotainment platforms, you’ll be able to browse through websites on the go, get new information on demand without losing concentration on the road.

4.4 Predictive maintenance

Predictive maintenance, enabled by IoT adoption, will allow drivers to improve vehicle maintenance and increase the longevity of the car. It consists of three main pillars:

⚈ Data gathering. IoT sensors collect real-time insights that’ll help the system to calculate the “time-to-failure” estimate.

⚈ Prediction. The collected data is transformed into a system of engineering values used in a prediction model.

⚈ Reaction. Based on the insights collected after the prediction stage, the maintenance system offers insights on how the overall state of the vehicle can be improved.
The examples of predictive maintenance systems include tools developed by Siemens and GE.

4.5 Safety improvement

IoT sensors can assist drivers in blind spot detection, control parking, check the rear view and the vehicles in proximity. Thanks to communication tools with other drivers, collisions can be predicted and prevented. IoT allows parents to control kids’ driving habits, prevent them from overspeeding, etc.

The practical examples of using IoT for safety improvement are BMW’s Assistant, Chevrolet’s Teen Driver Technology.

5. Internet of Vehicles: How It's Changing the Future of Automobile Industry

The application of IoT in the automotive industry has significantly advanced fleet management. These days, sensors for weight measuring, position tracking, and other purposes are installed into trucks.

A cloud application is used to store the vast amount of sensory data gathered from a large fleet of such trucks. Then, this data is transformed into a visual manner after being analyzed by various analytics features. This information is simple to use for a fleet operator to monitor the many fleet-related parameters.

As IoT-connectivity in the automotive industry picks up its pace, there are risks that come along. The industry will have to face challenges created by the adoption of new technologies and ensure that software can’t ‘surpass’ the driver in the decision-making process.

⚈ Battery and bandwidth consumption. To create a comfortable bidirectional communication flow between vehicles, one needs open sockets - that results in a bandwidth consumption increase. Adopting M2M messaging protocols is a potential way to limit the bandwidth usage without limiting the functionality of the Internet of Things.

⚈ Security management. As the Internet of Things becomes commonplace in the automotive industry, the issue of protecting vehicles from hacking will arise. AES and SSL encryption as well as giving a developer a possibility to either grant or deny access to the vehicle are a few potential fixes for the problem.

⚈ Signaling quality. Tunnels, routes in low proximity from populated centers are all subjective to the low quality of network connectivity. In these areas, getting real-time insights from IoT platforms will be impossible.

⚈ Maintenance cost. Adding IoT platforms to a vehicle creates additional systems that are at risk of malfunctioning. Fixing software bugs will add to the overall maintenance cost. The issue, however, will dissolve as the technology spreads further.

6. Conclusion

The Internet of Things is changing the face of the automotive industry, increasing its controllability and safety. A variety of connected solutions will make driving easier, more productive, and more enjoyable.

Finally, IoT adoption can help manufacturers reduce the negative environmental impact vehicles are capable of creating.

In case you’re looking forward to developing an IoT solution for the automotive industry, contact the team at Indeema. We provide SMEs and global businesses with innovative solutions for predictive management, data monitoring, and the automation of routine tasks.

Get to know the team better by taking a look at our projects. To discuss the development of your idea, contact us - we’ll be happy to get on board.

Yevhen Fedoriuk

Written by

Yevhen Fedoriuk

VP of Delivery at Indeema Software Inc.

In his role as VP of Delivery, Yevhen Fedoriuk places a strong emphasis on prioritizing client needs, drawing upon his extensive experience of over a decade in both technology and management.