Automotive trends that drive IVI innovations

Demand for advanced features

Demand for a bespoke driver experience has been rising steadily, to the point where advanced features have become a critical deciding factor when choosing car brands. In a Deloitte survey, advanced features are ranked by Japanese drivers as the most important factor for choosing car brands for their next purchase. This factor also tops the list in other major markets, ranking second in the US, South East Asia, and India, and third in South Korea and China [1].

Although specific offerings vary from brand to brand, AutoPacific’s 2022 Future Attribute Demand Study highlights several of the most-wanted features among drivers [2]:

  • Parking sensors, front and rear: chosen by 41% of respondents.
  • Distracted or drowsy driver monitoring system: chosen by 39%.
  • Tire fill complete alert: chosen by 39%.

Rising autonomous vehicle market

Autonomous vehicles have emerged as a megatrend in the automotive industry. McKinsey & Company predicts that by 2030, 12% of global vehicles sold will be equipped with L3+ autonomous technologies, and by 2035, 37% will feature advanced autonomous technology. Despite rising customer concerns about the safety of fully autonomous vehicles, interest in advanced autonomous driving features remains high: 25% of respondents express strong enthusiasm, and around two-thirds are willing to pay a premium of US$ 10,000 for such advanced features [3].

Because safety plays a deciding role in the future of autonomous vehicles, the Advanced Driver Assistance System (ADAS) has been strongly advocated as part of regulatory requirements for launching autonomous vehicles. For instance, the European Commission has introduced new rules on advanced safety features to improve road safety and enable fully automated vehicles [4].

These regulations set out additional requirements for specific vehicle categories:

  • All road vehicles: features such as intelligent speed assistance and driver drowsiness and attention warning, among others.
  • Cars and vans: lane keeping and automated braking.
  • Trucks and buses: blind spot monitoring, collision warning, and tire pressure monitoring.

Artificial Intelligence for Improved Safety and Personalized In-Car Experience

1. Driver drowsiness alert

As safety is a decisive factor for the mass adoption of autonomous vehicles, regulators have strongly supported ADAS to include advanced features such as driver drowsiness alerts. With drowsy drivers causing more than 90,000 crashes in the U.S. in 2017, according to the National Highway Traffic Safety Administration [5], detecting distractions and drowsiness has become critical for on-road safety.

AI addresses this challenge by collecting and analyzing drivers’ facial expressions to identify potential signs of drowsiness and issue timely alerts. Such AI-based systems have been statistically evaluated and shown to deliver high levels of accuracy. For instance, a study by Inkeaw et al. used an artificial neural networks model to analyze multiple facial variables, including eye aspect ratio, mouth aspect ratio, face length, and face width balance, while electroencephalogram signals (recordings of brain activity) were used as a baseline for comparison. The study reported promising results, with the analysis of eye aspect ratio, mouth aspect ratio, and face length successfully predicting driver drowsiness with a significant accuracy rate of 60.76% [6].

2. Predictive maintenance

Predictive maintenance is a widely adopted AI application that has been effectively implemented across multiple industries. In essence, it analyzes engine health and predicts potential downtime so that preventive actions can be taken in advance. Unlike traditional engine inspections, which rely on pre-scheduled checks or are only triggered when irregularities occur, predictive maintenance provides real-time updates on machine status and suggests optimal inspection timelines.

With AI-powered predictive maintenance, unexpected downtime is minimized and maintenance schedules are optimized, leading to lower costs, improved efficiency, and fewer disruptions to operations. These benefits also extend to the automotive industry, where predictive maintenance enables a smoother in-car experience and cost savings for car owners through fewer breakdowns and reduced reliance on fixed, pre-scheduled engine checks. Global automotive players are beginning to explore in-car predictive maintenance solutions. For example, Israel’s Kavim Public Transportation company recently partnered with Questar, an automotive technology solutions provider, to deploy a vehicle management platform that collects in-vehicle data and uses AI to detect potential malfunctions. As a result, the platform was able to identify serious malfunctions in 10% of the company’s bus fleet [7].

3. Personalized in-car experience

As AI applications become mainstream, customers increasingly expect personalization in every service they use, including transportation. According to a 2022 survey by Capgemini Research Institute, 73% of car users expect a built-in, AI-powered in-vehicle voice assistant [8]. This demand has intensified competition not only among carmakers but also among major technology companies.

Google and Apple have already established a presence in the automotive space through Android Auto and CarPlay, while Amazon has recently entered the market with Echo Auto, aiming to bring Alexa into vehicles. At the same time, automakers are developing their own AI-powered assistants with more advanced capabilities. For example, in 2018, Mercedes-Benz introduced the AI-powered voice assistant Mercedes-Benz User Experience, which is capable of understanding indirect commands. Instead of requiring drivers to issue explicit commands such as “volume up,” the system can automatically increase the volume when drivers express dissatisfaction.

Infotainment goes big with AR/VR

Immersive in-car entertainment experiences

In-car entertainment has evolved significantly, from a simple push-button AM radio to advanced systems with Internet connectivity. With the introduction of AR/VR technology, the driving and riding experience is being elevated to an entirely new level. The core benefit of AR/VR is to immerse users in a digital world with rich, interactive experiences, and automakers are starting to redefine their infotainment systems around this capability.

Audi, for example, has introduced Holoride – a VR-based entertainment package available on selected new models. It aims to offer passengers a wide variety of interactive games and applications. By partnering with leading game creators and blockbuster writers such as the Russo Brothers from the Marvel Cinematic Universe, the company is working to build its own Holoride universe [8].

AR-enhanced head-up displays for safer driving

Beyond entertainment applications, AR/VR technology has also been widely adopted for practical functions inside vehicles. A prominent example is the head-up display, where key vehicle information is projected at eye level so drivers can keep their head and gaze forward instead of looking down at lower instrument clusters.

With AR-powered solutions, data such as speed, lane guidance, and the distance to the vehicle ahead is shown directly on the windscreen. Mercedes-Benz has successfully deployed this feature in its models and has gone a step further by incorporating eye-tracking. This allows the projected information to move in line with the driver’s head movements, ensuring that critical data remains in an optimal viewing position at all times [9].

Closing thoughts

The in-vehicle infotainment system has undergone substantial updates to better align with rising consumer expectations and increasingly stringent regulations. Technologies such as AI and AR/VR open up exciting possibilities for delivering a truly bespoke in-car experience. However, successful implementation of these use cases requires more than simply adopting new technologies. A clear product roadmap, robust software development capabilities, and a high-quality, scalable digital workforce are all critical ingredients for long-term success.

Frequently Asked Questions

How have IVI systems evolved into in-car digital assistants? In-vehicle infotainment has evolved from simple AM radios to connected, screen-rich hubs that manage navigation, media, communication, and car settings. With AI, these systems now act like digital assistants, anticipating needs, personalizing content, and supporting driving, turning vehicles into assistants on the go.

How does demand for advanced features shape IVI and brand choice? Drivers now prioritize advanced, bespoke features such as parking sensors, drowsiness monitoring, and alerts when choosing brands. This shifts IVI from a nice-to-have to a core differentiator, forcing OEMs to invest in feature-rich, customizable infotainment to stay competitive and meet rising expectations.

How is AI improving IVI safety and personalization in cars? AI-powered IVI systems use cameras and sensors to read facial cues, detect drowsiness, and trigger alerts, supporting ADAS safety goals. The same data and models enable predictive maintenance and personalized voice assistants, tailoring content, settings, and interactions to each driver’s behavior and preferences.

How are AR and VR transforming in-car entertainment and UX? AR/VR moves IVI from flat screens to immersive experiences, from VR gaming packages like Audi’s Holoride to AR head-up displays projecting speed, lane, and distance data onto the windshield. Eye-tracking and dynamic overlays keep key info in view, enhancing safety and passenger engagement.

What do OEMs need to succeed with AI and AR VR in IVI? Winning with AI and AR/VR in IVI requires more than adding features. OEMs need a clear product roadmap tied to user value and regulation, strong software and UX engineering, and access to scalable digital talent, so innovations can be reliably built, updated, and maintained across fleets.