Crowned by success
Smart Eye's highlights
If 2019 was the year when we reaped great success in the automotive industry, 2018 was the year we sowed. In late summer 2018, there was a shift in the market where we noticed that the premium segment was no longer the focus. There were still requests from there, but more and more demanding RFQs came from the middle-class segment, by far the largest in the automotive industry. As a company, we realized that this was a critical time in the development of the DMS market. We made an active decision to fully invest in the fact that there really had been a shift in the market. This meant that we had to quickly prioritize resources in terms of both sales and marketing as well as how and what we developed. We realized that we should continue to invest in having a scalable software solution that can be executed on several hardware platforms. In addition, it must be classified for safety-critical vehicle applications. This hardware-agnostic approach gives our customers the opportunity to optimize the products in terms of both performance and system cost as well as utilizing the latest hardware technology, which is developing rapidly. The engineers at Smart Eye have done a fantastic job and have been able to develop a quality product in record time. It is nothing less than a feat of ingenuity that we are now reaping the fruits of.
In February 2019, we were able to tell about our first success in the middle-class segment, a Korean manufacturer with a total of 14 new car models. In March, signals came from the European Parliament on new legislation that included DMS. In May, the announcement was made of the next middle-class manufacturer, a Japanese-European car alliance. So far, a total of 13 car models have been announced from this alliance with the potential for more models in the future. In order to be able to continue the beaten path with an offensive business plan, SEK 200 million was raised through a directed new share issue at the end of May. Interest was great and the issue was heavily oversubscribed.
During the second half of the year, the real battle for the middle-class segment in the automotive industry started. Parallel purchasing processes took place in the US, Europe and Asia in both the premium and middle class. The outcome for the Smart Eye has been quite excellent, since we have reported the success of five car manufacturers so far after the end of the period. First one in China in January, then one in the US and three in Europe in March. A total of 25 new car models have been reported so far in 2020. We now have a total of 81 design wins, significantly more than all competitors overall. Both the European Parliament through legislation as well as EuroNCAP have put focus on DMS in new cars. Some procurement is still ongoing, but we have crossed the line in terms of first-generation mass market systems (as well as second-generation premium systems). In many ways, the dust has settled, and the stage is set from today until at least 2025. It is software from Smart Eye that will sit in most cars. Of course, we are keen to pin down as many of the remaining car brands as we can, and of course we have plans for how the next generation of DMS should be just as successful for Smart Eye.
Electrification and digitization
Two very strong trends that are fundamentally transforming the automotive industry are the electrification and digitization of the vehicle fleet. Both of these trends can be considered disruptive in the sense that there will be both winners and losers once the transition is complete. Electrification is driven by the need to change from fossil to sustainable and today, most electric cars are in the premium sector. There are many exciting development projects going on around the world where the price of electric cars is going down, so that the cost of car ownership including the fuel cost becomes very competitive. Furthermore, the automotive industry is less and less about hardware and more and more about software. In the automotive industry, experienced software engineers are in short demand and anyone who can serve the automotive industry with high-quality software expertise generally has a bright future ahead.
Not just headwind - sobering in self-driving
If 2018 was a year when the hype for fully self-driving cars was at its peak, 2019 was the year when many sobered and realized that it is a very difficult problem to solve having a fleet of cars where fully or partially autonomous cars should be mixed with ordinary vehicles and pedestrians. There were some very noticeable accidents and the optimistic forecasts of several car manufacturers abated. It can be said that reality caught up with the most unrealistic future visions/scenarios during the year, including that autonomous driving does not need DMS. Another event that also affected the mood in the industry was the so-called Dieselgate. Some manufacturers took shortcuts to achieve tougher exhaust requirements, which were penalized when it was discovered. Both of these things have, together, influenced some plans for new platforms, albeit to a lesser extent. This allowed us to see some tendencies for possible delays even before the Coronavirus struck.
Corona - dramatic in the short term, dent in the curve in the long term
It is beyond any reasonable doubt that Corona will affect the plans of the automotive industry, we just don’t know how. Although it is dramatic to be in the middle of the process, the high value of having access to “personal mobility” remains, a need that the car meets. Public transport is vulnerable in its own way, we have seen that now when social distance is desirable. The world’s middle class continues to grow, and the car remains as a sought-after property. The automotive industry post Corona will remain and continue to be a central pillar of the global industry and Smart Eye will be an important albeit small cog in this huge machinery. It is likely to be as after the financial crisis. The long-term trend is dominated by structurally underlying growth overlaid with a short-term decline in world production. All in all, the conclusion is that, despite external factors of uncertainty, Smart Eye has secured its position for a long time to come thanks to the automotive industry’s long product cycles. We will try to continue to win as many contracts as possible and to refine our technology even more so that our customers can continue to save lives with today’s and tomorrow’s technology.
Smart Eye’s Research department excels
Systems for measuring inside cars are more than just DMS. There will also be more sensors that detect everything that is important that is happening inside the car. There will be measurements based on cameras, radar and ultrasound. Such an evolution of today’s technology was carried out throughout 2019. The work was done by the Smart Eye research department’s dedicated group for development of advanced AI. At the beginning of January 2020, it was time to show the results in connection with the launch of CES in Las Vegas, the world’s largest high-tech trade show. The concept, which we call multimodal interior sensing, was very well received and has led to many exciting opportunities with industry partners. In the future, the protection will include children in the back seat, pets and passengers.
Aftermarket for professional traffic and heavy vehicles
In 2018, it emerged that there will be a strong opportunity to manufacture products for the aftermarket and in small series. We formed a new business area that was launched after the summer of 2019. It’s called AIS, which stands for Applied Artificial Intelligence Systems. The products will be manufactured in China. The new business area that sells to the aftermarket benefits from Chinese legal initiatives. We expect to start on a small scale at the end of 2020 or the beginning of 2021. The business opportunities that exist in the aftermarket may be realized at a faster pace than the DMS market for new cars
When Smart Eye was founded, measurement systems were the company’s focus. For many years we were able to hone the technology in collaboration with some of the most skilled scientists in the field. When it was time for the car companies to industrialize the technology, we could ride on many years of experience. Now we see the same happening again in new industries and we rely on Research Instruments’ well-documented ability to capture that type of customers and to help to get the industrialization process started. For the business area, 2019 can be described as something of a middle year as we have worked to broaden our product range. We exp
The aviation industry is knocking on the door
In 2019, the airline industry has started to move. We are in the same position as we were in terms of the automotive industry in 2014. We believe that the first Pilot Monitoring Systems may be in use around 2025 or shortly thereafter. We have not yet established a strategy for how to proceed in this market but are currently keeping all doors open. In conclusion, never before has there been a year in Smart Eye’s history that has been as successful as 2019. The foundation is laid for many years to come.
CEO Smart Eye
Founder and CEO
Phone: +46 70-329 26 98