Europe's auto engineers face an SDV reckoning at ELIV 2025
- SBD Automotive
- 6 days ago
- 3 min read
Updated: 2 days ago
At this year’s ELIV conference in Bonn, the mood among Europe's automotive engineers was a mix of realism and resolve. Once the undisputed leaders in vehicle technology, they now face a new reality where several newcomers have picked a better racing line and stolen their lead.
Hosted annually by VDI (the Association of German Engineers), ELIV has long been a window into the state-of-the-art for vehicle electronics. But with the rise of the software defined vehicles (SDV), its focus has expanded to encompass in vehicle software, AI-enabled development and the shifting dynamics of the software supply chain.
A Cloud Over the European Automotive Industry
The atmosphere at ELIV was notably subdued. Over the past decade, many attendees have watched first with curiosity, then with concern and finally with dread as Tesla, Rivian, and several Asian OEMs surged ahead in electric and software innovation.
Where automotive engineering students in Europe once assumed secure career paths, many now worry there may not be much of an industry left by the time they graduate. This quiet anxiety reflected a broader truth: Europe's automotive dominance is under pressure like never before.
Turning the Tide: Software Takes the Wheel
Despite the sobering mood, optimism was returning. German automakers are finally taking heart, realising that agility and software-first thinking must become their new core strengths.
BMW appears to be setting the pace, pioneering software development approaches that others are now eager to emulate. Throughout the conference, ELIV showcased a wave of tools and initiatives designed to help the industry accelerate this transformation.
Support for open source software was particularly vocal even from companies traditionally protective of their code. Initiatives from the Eclipse Software Defined Vehicle foundation aim to relieve carmakers from the tedious task of building low-level software so they can focus on customer-facing innovation.
At the same time, Tier 1 suppliers are moving away from “black box” software deals and toward more open, trusting relationships with OEMs. Many exhibitors showcased collaborative tools and workbenches that allow teams from different companies to co-develop software seamlessly.
AI and Simulation Take Center Stage
Artificial intelligence was the invisible thread running through the conference. Advanced simulation platforms from companies like Tata and Siemens demonstrated the next frontier of development where pre-release ARM chips can be tested virtually, and software teams can validate code against hardware that doesn’t even exist yet.
New validation tools now allow entire vehicles to be tested virtually using top-down, computer-designed simulations rather than human-generated test cases. Nearly every supplier at ELIV seemed to have their own flavour of AI “special sauce.” Sorting hype from reality remains difficult, but one thing is certain: companies that ignore AI risk being left behind.
Hardware Still Has a Role to Play
While software stole the spotlight, hardware innovation wasn’t absent. Microchip drew attention with its exploration of PCI Express as a potential successor to some types of Ethernet, promising a 30x increase in latency between high-performance vehicle computers. PCIe has proven itself in the computing world, but its automotive moment may still be several years away.
Meanwhile, chiplet technology (modular microchip design) showed intriguing potential. In theory, chiplets could allow carmakers to mix and match microchip capabilities “à la carte.” Yet for now, this remains a medium-term vision. Standardisation is still immature, and only viable within a few small ecosystems. To succeed in automotive, chiplets will need to become certifiable, compatible, and interchangeable across suppliers and product generations. This is likely a decade long journey.
Looking Ahead
"ELIV 2025 felt like a turning point for SDV developers in Germany. They are starting to embrace shared code and open source technologies as ways to escape the shadow of fast-moving, software-first competitors from the USA and Far East."
Henry Simmonds
Consulting Specialist
SBD Automotive
If this year’s ELIV was about acknowledging how far Europe's car industry has fallen behind, next year’s event may reveal how far it’s come in catching up.
The message from Bonn was clear: the future of the German automotive sector depends on embracing openness, collaboration and software-first thinking. The industry has finally accepted that it can no longer rely on legacy strengths, and the new race is being run in code.
ELIV will return to Bonn next year and we’ll be watching closely to see whether the promises made in 2025 turn into meaningful progress.
To help industry professionals stay ahead, we now offer 2025 Domain Passes, providing access to our research reports within a specific domain.
ADAS & Autonomy
Cockpit & Infotainment
Digital Connected Services
Electrification
Innovation & Strategy
Security
Software-Defined Vehicles
User Experience
Each pass also includes an exclusive, custom report that consolidates insights from our diverse reports into one normalized view, offering a clear perspective on OEM, supplier and ecosystem strategies within that domain. For more details or to receive our full catalog, contact us today!