According to the Zhitong Finance APP, Guohai Securities has released a research report stating that the commercialization of the intelligent driving industry is accelerating, with the penetration rate of intelligent driving/intelligent cockpit continuously increasing. This is expected to drive the domain controller hardware and software industry chain into an accelerated development phase, maintaining a &#34;recommended&#34; rating for the computer industry. The domain controller is a core component of intelligent vehicles and will benefit from the continuous increase in the penetration rate of automotive intelligence; the current commercialization of advanced intelligent driving is promising, and the domain controller industry chain is expected to welcome accelerated development.
<h2>The main points of Guohai Securities are as follows:</h2>
The era of autonomous driving is approaching, and the core position of the domain controller is established
Traditional automotive control systems are usually distributed, with each functional module having an independent ECU control. However, the distributed architecture faces challenges such as high system complexity, high development costs, and difficulties in troubleshooting. To address these issues, automakers have centralized multiple functional modules into one controller, giving rise to domain control. Domain control enables data sharing and system control between multiple functional modules, improving system integration and performance. It also supports the operation of multiple applications, enriching the services and functionalities of vehicles. As the overall vehicle functions continue to advance at the domain integration level, three mainstream domain controllers have formed: intelligent driving, cockpit, and body control. Architecturally, the domain controller mainly consists of hardware processors, system software, algorithms, and application software, with the industry chain covering upstream hardware and software suppliers, midstream domain control integrators, and downstream OEMs, with the mainstream business model primarily based on collaborative development.
Intelligent driving &amp; intelligent cockpit domain controllers are entering an installation acceleration period
Intelligent driving domain controller: High-level autonomous driving requires processing data from sensors such as cameras and radars, while also needing to complete calculations and decisions in a short time. The domain controller is the core component driving the implementation of advanced autonomous driving. According to the Gaishi Automotive Research Institute, the penetration rates for L2/L2++ level ADAS are expected to reach 36.8%/7.3% by 2024. According to Frost &amp; Sullivan data, the global intelligent driving domain controller market size was 16.5 billion yuan in 2022 and is expected to reach 115.4 billion yuan by 2026, with the penetration rate increasing from 0.1% in 2019 to 62.7% by 2030.
Intelligent cockpit domain controller: The intelligent cockpit is a human-machine interaction system built based on the interior and electronic fields of the cockpit, starting from consumer scenarios. The importance of the intelligent cockpit in the current automotive sales field has significantly increased. According to the China Business Industry Research Institute, the global passenger car intelligent cockpit market size is expected to reach 366.8 billion yuan by 2024 and 429.6 billion yuan by 2025. According to the Gaishi Automotive Research Institute, the penetration rate of intelligent cockpits in China has steadily increased since 2022, reaching 73% by 2024. Canalys estimates that the penetration rate will reach 80% by 2025, estimating that the market size of domain controllers in China will exceed 30 billion yuan in 2024.
Domain control hardware architecture: High-performance SoC position is solidified
The hardware architecture of the domain controller mainly includes communication units, computing units, and storage units. The computing unit typically adopts a heterogeneous design, consisting of SoC and MCU. As the level of intelligent driving continues to rise, the computing power required increases exponentially with each level from L2 to L5, making SoC the mainstream in automotive chip design and application
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<li>Cockpit chips: The traditional solution is to use a single chip to drive a single system. As the cockpit domain integrates more functions and the number of screens increases, it inevitably encounters communication delays and performance bottlenecks; however, SoC can run multiple systems through isolation technology, making the trend of &#34;one chip with multiple functions&#34; clear. 2) Intelligent driving chips: Integration + high computing power + advanced manufacturing is the mainstream trend. In the future, as the vehicle architecture evolves from domain-centric to central-centric, a single SoC needs to simultaneously meet the dynamic control of intelligent driving, cockpit, and body; on the other hand, high-level autonomous driving requires real-time processing of a large amount of sensor data, and powerful computing power as support is also an inevitable trend.</li>
</ol>
Domain control software architecture: The trend of loose coupling is clear, and the value of software is accelerating.
The current mainstream development trend of automotive software is the decoupling of software and hardware. The automotive computing platform is shifting from &#34;signal-oriented&#34; to &#34;service-oriented (SOA),&#34; breaking the embedded software development model and forming a three-part structure of system software, functional software, and application software. The system software field includes three major architectures: kernel, virtual machine, and middleware. Currently, the mainstream kernel layer is monopolized by overseas manufacturers and is expected to become a key breakthrough area for domestic automotive software; the middleware and functional software fields have layouts from complete vehicle manufacturers, traditional Tier 1 suppliers, automotive electronics, and third-party software suppliers; application software is the core part of differentiated competition in the automotive sector, accounting for over 50% of the value of automotive software. From market trends, McKinsey data shows that the value of software per vehicle in the overall vehicle is expected to rise from 10% in 2024 to 30% in 2030; according to data from Yiou Intelligence, the market size of automotive software in China was 17.1 billion yuan in 2018 and is expected to reach 37.3 billion yuan by 2025.
Related targets
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Domain controllers: Desay SV, Jingwei Hirain, NJEC, Huayang Group, Four-Dimensional Map, etc.
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Intelligent driving &amp; cockpit systems: Thunder Software Technology, KOTEI, Chengmai Technology, Neusoft Corporation, Hongsoft Technology, iFlytek, etc.
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Roadside equipment: Wanji Technology, Jin Yi Technology, Lais Information, Qianfang Technology, Tongxingbao, Wantong Technology, etc.
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Testing &amp; safety: Daotong Technology, Ruiming Technology, etc.
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</ol>
Risk warning: Policies related to intelligent driving may not meet expectations, technological advancement may not meet expectations, competition may intensify, performance of related targets may not meet expectations, and risks of social issues may arise

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Guohai Securities released a research report indicating that the penetration rates of intelligent driving and intelligent cockpits are accelerating, which is expected to drive the rapid development of the domain controller industry chain. Currently, automotive software is transitioning towards hardware-software decoupling, with domain controllers serving as core components of intelligent vehicles, enabling data sharing and system control among multiple functional modules. With the commercialization of advanced intelligent driving, it is expected that the penetration rates of L2/L2++ level ADAS will reach 36.8% and 7.3% in 2024

Zhitong

Desay SV

KOTEI

NJEC

VanJee

WANTONG TECH

CTFO

ArcSoft

SeeWay.ai

Thundersoft

Streamax

Sealand Securities

GENVICT

IFLYTEK

ARCHERMIND

Neusoft

Autel

FORYOU

Guohai Securities: The penetration rate of intelligent driving/intelligent cockpit continues to accelerate, and the domain controller industry chain is expected to usher in accelerated development