European Manufacturers Seek Transformation Amid Change
Service providers are pivotal in aiding Europe's automotive and semiconductor sectors to adapt to evolving business and technological landscapes, as reported by the ISG Provider Lens™. The 2022 report highlights a shift towards electric vehicles and software-defined vehicles, necessitating new partnerships to enhance product development. Challenges like chip shortages and supply-chain issues are exacerbated by geopolitical tensions. Despite these hurdles, companies are progressing towards digital engineering goals, with notable leaders like Capgemini and HCLTech recognized for their capabilities in the industry.
- Increased demand for services in automotive and semiconductor sectors in Europe.
- Transition towards electric vehicles prioritizing sustainability.
- Emergence of software-defined vehicles may enhance operational efficiencies.
- Recognition of service providers like Capgemini and HCLTech as leaders in the industry.
- Ongoing chip shortages affecting automotive manufacturing.
- Geopolitical tensions may disrupt future supply chains.
- The shift to custom ASICs may indicate challenges with traditional processors.
Service providers are enabling Europe’s automotive and semiconductor companies adapt to new business conditions and technology needs, ISG Provider Lens™ report says
The 2022 ISG Provider Lens™ Manufacturing Industry Services report for
“Europe’s automotive and technology industries are entering a new age that demands rapid adaptation to remain competitive,” said
Regional goals for sustainability have helped to bring electric vehicles (EVs) to the top of the agenda for European auto manufacturers, the report says. Scaling up EV manufacturing and infrastructure development from a cutting-edge project to the central thrust of the industry’s development and production efforts requires fundamentally new architectures in a relatively short time in automotive terms. EVs have even taken precedence over autonomous driving technologies that a few years ago constituted the key vision of the industry.
On top of the shift to EVs, the rapid evolution of other new automotive technologies, including advanced driver assistance systems (ADAS), digital cockpits and vehicle-to-everything (V2X) communication, is leading manufacturers to define new vehicle platforms in terms of software more than hardware, ISG says. The emergence of software-defined vehicles has brought concepts from the IT industry to the product architectures and development methods of the automotive world.
European hi-tech manufacturers are adapting to continuing supply-chain challenges stemming from the COVID-19 pandemic at the same time as geopolitical concerns cloud their future outlook and new enterprise demands change product requirements, the report says.
Chip shortages continue in some industries, especially ones that use older process nodes, such as automotive, because most of the new fabs coming online use more modern nodes, ISG says. Rising geopolitical tensions have heightened concerns over future supply-chain disruptions.
At the same time, many European enterprises are beginning to favor custom ASICs over traditional complex processors and SoCs, partly due to the need for specialized sensors and edge computing devices in IoT networks. Service providers have enhanced their ASIC development services to meet this demand, in part helping to ease concerns over a scarcity of talent.
“European companies face challenges related to people, processes and technologies as they pursue advanced technologies, but they continue to show progress toward their digital engineering goals,” said
The report also examines other issues affecting manufacturing in
The 2022 ISG Provider Lens™ Manufacturing Industry Services report for
The report names Capgemini, HCLTech, LTTS, TCS, Tech Mahindra and Wipro as Leaders in two quadrants each. It names ALTEN, eInfochips, Embitel, HARMAN Digital Transformation Solutions (DTS), Infosys, Intellias, Mobica and UST as Leaders in one quadrant each.
In addition, Ignitarium, LTIMindtree and Mobica are named as Rising Stars — companies with a “promising portfolio” and “high future potential” by ISG’s definition — in one quadrant each.
The 2022 ISG Provider Lens™ Manufacturing Industry Services report for
About ISG Provider Lens™ Research
The ISG Provider Lens™ Quadrant research series is the only service provider evaluation of its kind to combine empirical, data-driven research and market analysis with the real-world experience and observations of ISG's global advisory team. Enterprises will find a wealth of detailed data and market analysis to help guide their selection of appropriate sourcing partners, while ISG advisors use the reports to validate their own market knowledge and make recommendations to ISG's enterprise clients. The research currently covers providers offering their services globally, across
A companion research series, the ISG Provider Lens Archetype reports, offer a first-of-its-kind evaluation of providers from the perspective of specific buyer types.
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