India Means Innovation podcast episode: Innovation in the Automotive sector

Transcript Disclaimer: This transcript has been generated using automated tools and reviewed by a human. However, some errors may still be present. For complete accuracy, please refer to the original audio.

00:00:14 SNEHIL GAMBHIR: Welcome to this edition of the Nasscom BCG India Means Innovation podcast. I'm excited today to have as my guest a technologist, a customer experience zealot, Gilles Mabire, who is the Chief Technology Officer for Continental Automotive. Gilles, welcome to the podcast.

00:00:36 GILLES MABIRE: Thank you very much for the invitation.

00:00:38 SNEHIL GAMBHIR: Wonderful. Gilles, why don't we get started by taking a long-term view of where we are in the global auto industry, particularly in the context of technological advancements? With cars becoming "code on wheels," what major trends do you anticipate happening in this decade and the next—not just from a Continental perspective, but from a broad industry lens, including ICE versus EV?

00:01:10 GILLES MABIRE: First of all, if we look at our industry globally—and this applies to every region—we see that car technology has evolved dynamically. Electronics have been at the core of this evolution, and software has become a major element. Today, the processing power in cars is significantly higher than in airplanes, and the complexity is not to be underestimated.

The challenge ahead is that we need to change this concept. Complexity will continue to increase, and with the current system architecture, we have reached a limit that is no longer sustainable. We need to rethink vehicle architecture so that cars are part of a larger ecosystem—not just standalone objects but connected to charging infrastructure, mobility environments, and the cloud.

Of course, we need to adopt the right approach to make this transition seamless and scalable. As industry players, we must drive this change. The term "software-defined vehicle" is widely used, but at the end of the day, the goal is to adapt vehicle architecture to manage complexity and enhance the end-user experience. The IT and consumer industries have set new benchmarks for user expectations, and we must align with them.

00:02:51 SNEHIL GAMBHIR: Wonderful. Given that context, Gilles, what is Continental Automotive’s vision for the future? What are you focusing on for the remainder of this decade, and what’s around the corner in the next decade?

00:03:13 GILLES MABIRE: At Continental, we have defined our vision: we want to drive mobility that is safe, exciting, and autonomous. This defines our playground for success. We aim to create and capture value for shareholders and customers by developing superior products compared to our competitors.

We must be strong in technical and system understanding—not just of the car as a system but of the entire ecosystem in which it operates. Breaking down complexity into manageable elements helps us shape our product portfolio, ensuring we develop the right products at the right time. This entire process is supported by the software-defined vehicle approach, which enables us to develop faster, leverage cutting-edge technologies, and transform our organization into the partner of choice.

00:04:15 SNEHIL GAMBHIR: Got it. You’ve mentioned the word "ecosystem" multiple times. I came across a quote from you that said, "We are shaping the entire ecosystem, from the road to the cloud." I love that phrase—the road to the cloud. Could you elaborate on what this ecosystem entails? As CTO, what is your vision for products and offerings within this framework?

00:04:49 GILLES MABIRE: First of all, we must recognize that the game is changing, and we are determined to capture a portion of this new landscape. The value is shifting—partially from hardware to software and from onboard (in the car) to offboard (in the cloud). This transition—from the road to the cloud—closes the loop between virtual and real-world applications.

We need to answer two questions:
1. What do we want to offer? This includes hardware, middleware, operating systems, software functions, data, and cloud integration.
2. How do we offer it? This involves AI-driven visualization, continuous integration testing, and ensuring seamless adoption for our customers.

We cannot claim to offer the best products unless we also help customers integrate them effectively. Therefore, we have no rigid approach—we embrace partnerships that help us move faster and reach the right technological solutions. We do not aim to compete with everyone; instead, we bring partners together to create a larger ecosystem. Sometimes, our partners are customers, traditional suppliers, or IT companies. The go-to-market strategy is shifting from a traditional vertical structure (OEMs dictating to Tier 1 suppliers, and so on) to a horizontal, collaborative approach. This only works if we partner with organizations that share our goals and vision.

00:06:30 SNEHIL GAMBHIR: So, if I take this definition of new mobility and this stack that you mentioned, right, it's a complex combination of chips, cloud, mechanical, digital, electronic sensors—you name it, right? It's getting more and more software-driven, right? From a systems-thinking perspective, what are some of the challenges, and how do you define the new architecture? And then, where to play from a Continental lens versus what you just said? Where do you partner with the OEMs? Where do you partner with completely different players in the IT ecosystem, etc.? How does that look from your lens?

00:07:13 GILLES MABIRE: Our job is so wonderful that we have plenty of challenges in front of us. One that is clearly visible is that if you look regionally at different zones—Asia, for instance—we need to differentiate China, Korea, Japan, and India. We have Europe as well. You have the US, and not every region is reaching the same point at the same speed. That’s the first observation. The second one is that all customers are slightly different. You have premium ones, more generic ones, and entry-level customers. Therefore, the solutions we need to bring in terms of architecture are significantly different. We need to have building blocks that can cope with the diversity of customer arrangements. We need to maximize the economy of scale. However, the way we assemble these building blocks may be different from one customer to another.

The second topic that differs is customer expectations. In the past, to simplify, we were offering something ready to use. We were trying to package hardware and software into a type of product and minimize variations for everyone. But customers are no longer willing to accept the same solution. Now, we need to have a kind of à la carte approach where each and every piece of our menu—sometimes hardware, middleware, or software functions—is competitive in terms of functionality, cutting-edge in terms of technology, and extremely attractive in terms of price. Not all customers will buy everything at the same time and everywhere. For us, this is an opportunity because we have all the components, but we need to package them in the right way.

00:08:55 SNEHIL GAMBHIR: OK, wonderful. In this environment, as we sit in this massive technology center that you have, historically, innovations in core engineering have been spaced out over many years, sometimes even decades. In contrast, today, with digital twins and SDV, innovations are compounding far more rapidly. Do you foresee any challenges in managing this fast rate of innovation within the auto industry in particular, and how do you see that playing out?

00:09:35 GILLES MABIRE: If we take for granted that the majority of innovation will be triggered by software, we also implicitly accept that the entry barrier will decrease. It is extremely complex to create a sophisticated hydraulic system in a car. However, developing even a complex software solution and offering superior value is different. At the end of the day, I am convinced that the availability of software-based technology will spread worldwide. The key differentiator will be how you make it stand out from competitors.

Take the example of PCs and virtual communication tools we all used during COVID. I won’t name specific brands, but everyone knows which solutions work better than others. The common denominator is the same—PC, microphone, and camera. Yet, the user experience varies significantly. Where does this difference come from? Software. The same functions, applied differently, create unique experiences. That is where the secret sauce lies—the ability to understand a problem, create a function that works better, requires less hardware processing power, and delivers uniqueness. To achieve this, we must understand the underlying technology available in the car and leverage it to enhance our functions.

00:11:00 SNEHIL GAMBHIR: So, I think what I’m hearing you say is that with a lower barrier to entry, driving innovation automatically accelerates. We just have to keep pace with it and adapt accordingly.

00:11:11 GILLES MABIRE: OK, let me give you an example. We are working on what we call in-cabin sensing. In-cabin sensing is essentially about understanding what is happening inside the car while driving. Why do we do that? Because when cars run autonomously, we need to know how many people are inside, whether they are tired, if they are looking at the road, using their mobile phones, reading something, their mood, and whether a child is inside for safety purposes. Just implementing this requires integrating a variety of technologies. However, for the user, the function should be simple.

The underlying technology is complex and involves combining airbag information, braking systems, ADAS functions, displays, cameras, face recognition, and processing power to derive insights and take the right decisions when necessary. This can either be done poorly or exceptionally well for the user. Additionally, this capability allows us to offer people content on demand, location-based services, and recommendations based on their mood and habits, thereby creating uniqueness.

00:12:14 SNEHIL GAMBHIR: Got it, got it. Given that so many components are at play and the game is changing, what role do collaborations and partnerships play in Continental’s next strategy? Can you share some examples of successful partnerships you have entered into or are considering that would strengthen your position in the next generation of automotive technology?

00:12:45 GILLES MABIRE: At every level of the stack, from hardware to cloud, we have partnerships. Just in the hardware space, we work with Synopsys to virtualize components. We also have a partnership with AWS for cloud infrastructure, helping us move from cloud development to virtual development. We partner with Google for LLM when it comes to cockpit solutions, offering intuitive and AI-based conversational models to users. The difference this makes to user experience in cars is like night and day compared to existing market solutions.

Of course, we have many other partnerships. However, the key question is always: What do we want to achieve, and how do we achieve it best? Should we do it ourselves, or does a solution already exist that we can integrate? If so, we partner and find common ground.

00:13:43 SNEHIL GAMBHIR: Got it, got it. So, you know, you've been a lifelong auto enthusiast, a technologist at heart. Given the pace of innovation that's happening, how do you promote this culture of innovation and a culture where it's OK to fail? There is an element of fear of failure generally. You have a very large set of engineers across the globe. What do you, as a CTO, do to encourage them to innovate in this new world?

00:14:11 GILLES MABIRE: There are, in fact, two important phases of innovation. The first is where we need to accept uncertainty. We need to accept that not every type of innovation will lead to a result. A result could be starting a proof of concept, engaging with customers, and dealing with a business afterwards. But at the very least, we learn—we learn a lot. We learn what we should probably not repeat, and we learn something that will help us next time to be faster and stronger. That is the phase where it's acceptable to fail. The limit, of course, is that sometimes we would like to do more, but we have to make trade-offs between different opportunities.

But that phase, I think, is well understood. The more important topic is how, from a good idea that starts to become truly interesting, we can move quickly into product execution. Because during the first phase, there is relative freedom in terms of a culture of failure. When it comes to something we all believe we should invest in, we need to move fast because that is the secret sauce to success—having a product before the competition reaches the market. That is where we sometimes need to bring in people from different horizons and organizations, who have the right competencies, to help us move quickly in the market.

And here, it's a change of culture. We need to make speed of execution a core essence of our business. Like any other company, we must always ask ourselves: Do we have the right processes? Can we speed things up here or there? We have plenty of projects right now to improve the speed and quality of production. We have also observed that, particularly in Asia—China, in particular—where we have a big business, we had to learn from their culture of speed. I think we are now on a good track to also convince our internal stakeholders and external customers that there are good recipes for deciding quickly, settling requirements, and bringing products to market much faster than before.

00:16:21 SNEHIL GAMBHIR: OK. So, I guess this is learning in progress, right? You and I were talking a little while earlier about the Vision 2030 report that BCG and Nasscom did around the ER&D segment, identifying five mega trends—digital engineering, generative AI, sustainability, and obviously, the element of skill and population inversion, which is creating a shortage of talent, especially in major Western markets.

As a business leader, particularly one who drives technology for the organization, what do you see as the main contributions your tech center in India will drive today and in the future?

00:17:14 GILLES MABIRE: Basically, your study summarizes what is also in our minds globally. I would like to start with sustainability because it will affect the way mobility exists in the future. We have, of course, a mission to improve mobility, but also a duty to make it sustainable. At all stages—starting from design, down to operation, and then the entire lifecycle, including recyclability, and so on—we have a societal duty.

And this duty is increasingly being asked about by the new generation joining us. They don't just want to do something fancy in the company; they want to understand the purpose. "What is your claim on sustainability?" And that is something we, as a company, are taking seriously. We have committed to CO2 reduction and so forth.

When it comes to engineering and technology—using digitalization for engineering or generative AI—we are on the way. It's something we are progressively rolling out. But the most important aspect is people. People are, at the end of the day, what makes the difference. If we all have the same tools to develop products, what is our unique selling point? It's our people.

The unique selling point of a company is its ability to be so attractive that the best talent wants to join. And the second element is to provide a future and purpose for those people—to train and develop our employees. I am very pleased that we have established a Software and Engineering Academy in Bangalore, where we have trained thousands of engineers over the past years, keeping them up to date with technology.

For example, we are training them to move from traditional software development to cloud development, to work with artificial intelligence, to manage complex systems, and to understand complex integrations. People entering Continental do not come just for a job; they come for a career. And that is the way to succeed in the ongoing talent war that we read about in the news.

I don’t have a magic recipe. Of course, we work with universities to ensure that training programs in different regions align with what we believe will be the major industry trends. We are also very close to startups in India and other regions, ensuring that we connect with the right companies. Supporting university programs, sponsoring challenges for young generations, and providing continuous learning opportunities are all part of our strategy to secure the best talent.

What we have also done—and I would like to highlight this, especially in Bangalore—is make significant efforts to be an attractive employer. We now have a relatively low attrition rate, which is highly appreciated. This proves that people recognize the efforts made by us as an organization, as well as by our local colleagues, management, and HR teams. But it’s a never-ending story. There is no magic formula. We need to fight to ensure that people feel good, that we provide them with career perspectives and purpose.

00:20:36 SNEHIL GAMBHIR: Yeah, I'll come back to the talent point, but I wanted one extra insight from you on sustainability because I think that's a very important topic from an innovation and delivery perspective. What you do from a net-zero perspective is one thing, but as the industry evolves, how do you see sustainability being woven into the next generation of cars?

Obviously, there's the ICE vs. EV part of it, but beyond that, as generative AI comes in and there's a larger move toward the software-ization of cars, how do you see this transformation playing out—not just for you, but for the broader auto industry?

00:21:15 GILLES MABIRE: Well, basically, in all the technological steps we envision, you can find a good reason why they contribute positively to sustainability. Let me give you a basic example. By simulating ADAS systems using scientific data training models in a virtual environment, you can simulate millions of driven kilometers in seconds or minutes. This eliminates the need to drive 1,000 kilometers physically.

If I take a good example of a product where technology helps, we have put on the market a solution called Eorizon, which is both a hardware and software solution that builds a digital map. This helps 80% of vehicles equipped with these technologies optimize gear shifting depending on the slope of the road, leading to a 30% fuel saving and reduced CO2 emissions.

But we have to do more. There are areas where we are working on different materials to bring into our cars. Our colleagues at ContiTech are very active in offering recycled materials and materials that require less CO2 to be produced. Additionally, we need to design for remanufacturing and sustainability—how to create a product where raw materials can be disassembled more easily and recycled efficiently.

For example, when we talk about displays or brake calipers in our cars, how do we use a different supply chain of recycled materials requiring less CO2? We are preparing a concept that we will showcase later this year, demonstrating our vision for making a product designed for sustainability. It's also a shift in mindset. We approach our customers and discuss these requirements—if they prioritize sustainability more, we can develop the product differently. I am sure that end users are becoming more sensitive to this argument, and increasingly, we will see consumer demand for vehicles based on their sustainability value. This is now a key part of our strategy and product development.

00:23:35 SNEHIL GAMBHIR: And let me now connect this to the talent question because I’m sure the passion you bring to sustainability is an attractive point for many in today’s younger generation.

From an innovation perspective, when you look at the global talent pool you work with and recruit from, what are their key drivers? And specifically, since we’re sitting in India, how have you seen the talent pool evolve over the years—from what you were hiring earlier to what it is today? How has their approach to driving innovation at Continental changed?

00:24:15 GILLES MABIRE: Since my last visit to Bangalore, I had the opportunity to speak with many of our colleagues here. We clearly see increased maturity in how people communicate, question, explain in-depth what they do, and why and how they do it. There is now a more systematic and systemic understanding of the broader ecosystem. They take pride in being responsible for customers, whereas initially, the role was more of a support function for other larger locations.

We see a growing sense of responsibility and the capability to take on more ownership. I believe this is the most important factor when joining Continental as compared to other players. You don’t come here just to develop a piece of something you don’t fully understand—you get a bigger perspective. We also provide opportunities to grow into larger roles.

The next step, which we haven't done enough of but are now focusing on, is ensuring that global roles in the company emerge from locations like Bangalore. This is one of our biggest R&D centers in the world. I’d like to take this opportunity to thank all our colleagues who have contributed to making Continental’s presence in India so successful.

00:25:30 SNEHIL GAMBHIR: Great. No conversation today is complete without mentioning generative AI. Gilles, I know this could be a long discussion, but in brief—how much of generative AI is real today? And where, from your perspective at Continental, are you seeing the most impactful use cases?

00:25:52 GILLES MABIRE: First of all, we have set AI as a core part of our strategy for many years now, around two pillars: 
1. We want to make Continental an AI-driven company. 
2. We want to develop AI-based successful products.

Becoming an AI-driven company means looking at all steps of our operations—purchasing, supply chain, controlling, HR processes—and identifying where AI can make us more successful, more agile, and ultimately, more cost-efficient. During the component shortage, for example, using AI to forecast unit requirements would have helped the industry produce more efficiently and avoid supply chain disruptions. We have now implemented AI-driven forecasting to improve our mid- and long-term planning, ensuring better production and procurement decisions.

AI in product development is also transforming our approach by automating requirements gathering and aggregating information across different domains. We now have Copilot solutions for software development, significantly improving not only the speed of software creation but also the quality of outputs. AI also enhances testing, particularly unit testing for software modules, reducing defects and accelerating development.

We further leverage AI in complex software testing, where the number of possible scenarios exceeds human capabilities. By automating and expediting test execution, we achieve higher accuracy and better results.

In autonomous driving, AI plays a crucial role in testing and retraining algorithms in complex, real-world situations. We are pioneers in Level 4 trucking, collaborating with partners like Aurora in the US. This data-driven approach allows us to collect and analyze insights continuously, improving our products day by day in preparation for SOP (Start of Production) in 2027.

00:28:04 SNEHIL GAMBHIR: Wonderful. I know we’re short on time, so I’ll keep these next questions quick. You’ve had commercial stints in your career despite your engineering background. Let’s talk about the India market—products made in India for India and the world. What are your thoughts on how the Indian market has evolved, and what opportunities does Continental see here?

00:28:46 GILLES MABIRE: We already do a lot in India—for India and for the world. Many of our components originate here. When we talk about innovation, it’s also about combining existing technologies to create solutions that are more usable, smaller in size, faster to market, and adapted to specific needs.

The Indian market is evolving, with a strong focus on entry- to mid-segment cars but also an increasing appetite for premium segments. This is where local expertise is crucial—we need people who understand the market and can identify business opportunities. When the business case is positive, it becomes a great opportunity, and no one understands this better than people who live and work in the market.

A key advantage we have is the presence of multiple competencies in India across different business areas. This allows us to combine technologies effectively, reuse existing components, and assemble them into solutions that precisely fit market needs. We give teams the freedom to act and innovate, and it has proven to work successfully.

00:30:09 SNEHIL GAMBHIR: I imagine there’s also a lot of opportunity in the two-wheeler market from a safety standpoint. Let’s talk about that.

00:30:19 GILLES MABIRE: Absolutely. Let me give you an example—we now have front and rear radar solutions specifically for two-wheelers. Just driving around the city today reinforces my belief that there is a huge market for that.

00:30:34 SNEHIL GAMBHIR: Great. Now, let’s touch on ADAS Level 4. When do you think half the world will have it?

00:30:46 GILLES MABIRE: Ten years ago everyone was telling in five years everyone will drive autonomously. You will I will have to apologise but I will I will not make this prediction. The thing which is I think extremely valid and right we will see level 4 coming in different type of markets means the first one which probably be in the trucking area because there is a clear business case, you get the driver out of equation which is in your problem in the US because there is not enough people. And this one is exactly what we are driving with a project of Ora Clear pass clear deadline technology is known. We now test and validate the system to be ready and the business case is there because you can sell the functions and and the the business case is clear. When it come to a vehicle, we see that the approach which was originally let's make a Level 3 or level 4, what's too complex? Therefore, the solution have been breakdown in two steps, which I think is the right approach by reinforcing the just a safety regulation with different package and functions where we can test and mature the algorithm. And there will be a next step where you you need to go from the level 2 that we call level 2 plus plus plus plus to Level 3. And there is still a way to go. And I think if we really want to go that way, we need as well to make sure that we can test in public row, that we can extend the experimentation, capture data, learn from from the doing and to get the algorithm with the right maturity. The second thing which was not ready at that time 10 years ago is the ability to use the virtual environment to test and mature the system. That will give us a huge opportunity to speed up. Last but not least, and that is a job for engineers is to make a solution at the right cost to get acceptance for the market. And I think we will see in the years to come, let's say combining elements, integrating technologies where we probably will come to affordable, more affordable price for the situation. But it's still a long way to go because making a proof of concept or a demo car, it's easy making all corner in this case fixed in different topic. And for us being safety based company, we cannot put on the market something that is not safety proven.

00:33:04 SNEHIL GAMBHIR: No, and that's why I said half the world because I understand the that we made progress, but the point of inflection is still some ways away. Let's let me end the podcast with a rapid fire question. Just one word answers very quickly three things Agile, favorite country to visit and you can't say India, Germany or France.

00:33:26 GILLES MABIRE: Japan.

00:33:27 SNEHIL GAMBHIR: Japan favorite food to eat?

00:33:34 GILLES MABIRE: Yes, Seafood.

00:33:36 SNEHIL GAMBHIR: Seafood and favorite sport you follow and I am sorry for the the current Euro Cup, you know final lineup, but nonetheless besides.

00:33:46 GILLES MABIRE: I would say rugby now.

00:33:47 SNEHIL GAMBHIR: Rugby now. OK, Wonderful Gilles. It's been a pleasure talking to you. I want to wish you and the continental teams across the globe the very best in your innovation journey, and I look forward to catching up with you again sometime soon.

00:34:00 GILLES MABIRE: Thank you very much.