Connected Business Technology Who controls the SDV tech stack? The question defining the future of automotive software June 11th, 2026 As software-defined vehicles (SDVs) rapidly become a reality, the middle layers of the technology stack are becoming increasingly contested and competitive. For OEMs, the challenge is how to keep pace with development while maintaining control. When will we reach the era of software-defined vehicles? We’re arguably already there. We have the technology, the economics are proven, and many OEMs are already delivering SDVs to the market. But developing an SDV and actually owning it are two different things. The question OEMs need to ask is not whether they have transitioned to SDVs, but who owns and controls the architecture they have transitioned to. How are SDV technology stacks evolving? Put simply, the traditional architecture of connected vehicles places hardware and chip manufacturers at the bottom, software and service providers in the middle layers, and OEMs as the owners and orchestrators of the overall ecosystem. As we move towards SDVs, these structures are becoming increasingly complex and multilayered. On the one hand, a growing number of OEMs are moving further into the stack and bringing their software development in-house. At the same time, many hardware manufacturers are moving up the stack – extending beyond components to offer software platforms, development toolchains and middleware that build on top of their silicon. The Tier 1 suppliers who historically sat between OEMs and hardware, acting as system integrators across much of this middle ground, are themselves under pressure from both directions as this dynamic plays out. For OEMs, the level of control they can maintain over their vehicle architecture will increasingly determine where they sit in the value chain. What does this mean for OEMs and SDV development? Three broad routes are emerging across the industry. While almost all SDV strategies involve partners in some form, what distinguishes OEMs from one another is what roles those partners play, and how much architectural direction they retain. For most, these consequential choices deserve a clear strategic rationale. Path 1: A proprietary route into the stack Three broad routes are emerging across the industry. While almost all SDV strategies involve partners in some form, what distinguishes OEMs from one another is what roles those partners play, and how much architectural direction they retain. For most, these consequential choices deserve a clear strategic rationale. Many OEMs that are successfully doing this are newer EV manufacturers in Asian markets. They can do this because software-defined vehicles are their starting point and they can develop both automotive and software capabilities simultaneously. For many legacy OEMs in Europe and North America, which have historically been pure automotive manufacturers, this is a much bigger challenge. It requires them to pivot from automotive hardware to software development, and that requires significant investment in infrastructure and large-scale recruitment of new skill sets in a completely different field of expertise. For this reason, it is rare for a legacy OEM to bring their entire development in-house, and many continue to work with multiple external partners in a relatively wide capacity. Thus, Path 1 is about who writes the rules of the architecture, not who manufactures every component within it. Path 2: Utilize hardware-led platform ecosystems At the other end of the vehicle architecture, hardware manufacturers are increasingly moving beyond components – extending into middleware, ADAS software, and development toolchains. These are typically companies with vast expertise and experience, and for OEMs this can accelerate development and reduce integration complexity. However, entering into such agreements also means giving up a large degree of control and becoming heavily dependent on hardware suppliers. In some cases, particularly in China, chip and platform suppliers are delivering solutions that span several technology layers, significantly shifting architectural control away from the OEM. When OEMs enter such arrangements, they risk locking themselves into long-term agreements that can be applicable for the vehicle's entire lifecycle. And if an OEM is working with a chip manufacturer in another region, that relationship can be adversely affected by geopolitical disputes or supply chain bottlenecks. Path 3: Partner up and collaborate It is exceptionally difficult for legacy OEMs to make the transition to software-defined vehicles alone. The most effective approach is typically a clear strategy built around strategic, collaborative partners – a shift from the transactional supplier relationships of the past. Hardware and compute platform providers can still appear in this path – their presence alone does not define the path. What defines Path 3 is that the OEM retains orchestration of the overall architecture. Specialist partners contribute depth across defined domains – connectivity, cloud platforms, application and other software capabilities – while the OEM maintains strategic direction and shapes how these pieces connect. The value is not simply access to external expertise – it is that the OEM remains the author of its own vehicle architecture. Why it is important to have a clear strategy The direction of travel across the industry makes the stakes in these choices clearer. OEMs with strong in-house software capabilities are continuing to deepen that investment, validating the Path 1 model for those who built software-first from the outset. Hardware and compute platform players have continued to extend their software reach, embedding platform dependencies further into OEM development programs. And a growing number of manufacturers are turning to collaborative specialist partnerships specifically to preserve strategic direction. Most OEMs today are not cleanly on one path – and that is a realistic response to the complexity of SDV development. But it makes strategy more important, not less. The deepening of partnerships between western and eastern OEMs to access platform capabilities at scale is a sign of how consequential and complex these choices have become. The technology layers of this new mobility era are being shaped from several angles – inside and outside – and OEMs that do not have a clear view of what they intend to own will find those choices made for them. For more insights and industry trends, read our articles Four key trends reshaping the automotive industry and Software-defined vehicles and AI: the next automotive evolution. You can also explore more content on our WirelessCar Insights Blog. William Ranåsen Market Intelligence Analyst Contact
