Chipping in

Intel eyes new markets in tie-up with BMW

main 0201287433 AP – Harald Krueger BMW CEO M8 Gran Coupe model Geneva car show March 2018
Intel inside, very much BMW on the outside. Source: AP

A self-driving car generates about 4,000 gigabytes of data a day, the equivalent of the smartphone usage of 3,000 people. For a chipmaker like Intel, this is a potential goldmine for its semiconductors, servers and cloud centers. They process the information and keep the vehicle safely on the road, while the passengers watch a movie or enjoy a conversation without minding traffic.

Intel teamed up with BMW and sensor maker Mobileye two years ago to develop the technology for these self-driving cars, hoping to tap into a potential growth market. It bought Mobileye, an Israeli company, last year for $15.3 billion, because sensors are dominant in many cars with driver-assist systems.

To further cement their partnership, BMW and Intel officially opened a new development center for self-driving cars this week in Unterschleissheim, a town north of BMW’s headquarters in Munich. Several dozen Intel employees have already started working there, sharing office space with 1,000 IT and automotive specialists from BMW.

What aluminum design wheels were in the past, are now the chips.

The cooperation with BMW should help Intel tap into a new booming market to compensate for stagnating sales of computer chips. The two companies hope to bring self-driving cars to the market by 2021 and set an industry standard, which other carmakers and suppliers could also use. Component maker Delphi has already joined the initiative, which competes with chipmakers such as Nvidia and Qualcomm, car parts makers Bosch, Continental and Autoliv, as well as Google’s Waymo and Uber.

During the center’s opening ceremony, BMW said it was transforming “into a tech company.” The 102-year-old carmaker realizes how important the new technology could become. Mobility services, such as self-driving taxis and trucks or car-sharing, could one day bring in more revenue than simply making and selling vehicles.

At Intel, employees phrased the importance of digital technology a bit more bluntly: “What aluminum wheels were in the past, are now the chips.”

13 p18 Intel computers as main source of revenue-01

Joachim Hofer covers the sports, leisure and IT sectors for Handelsblatt. Axel Postinett covers consumer electronics and internet corporations from the US. To contact the authors: hofer@handelsblatt.com and postinett@handelsblatt.com

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