The Secret to EV Success Is in the Software

There’s a common misconception about what makes electric vehicles so disruptive. Automakers have long considered their core technology to be the powertrain—essentially the engine and transmission. For all of the components they bought from suppliers, it was a pretty safe bet that premium carmakers in particular would assemble the powertrain themselves. That, they thought, is what set them apart. Thus, BMW AG’s advertising slogan is “Freude durch Fahren” (“joy through driving”).

- Alex Webb

Electric vehicles are changing that, not because electric powertrains are better, but because, with a few exceptions at the superhigh end, they’re all broadly similar. The driving experience in an electric BMW differs little from that in an electric Cadillac. That’s the problem: The power train has ceased to be the differentiator.

Tesla Inc. has made a very good case for what should take its place: “user experience,” as Silicon Valley likes to call it. Much of it comes down to the software interface that runs the vehicle. Tesla drivers rave about the iPad-like display that controls everything from music to driving modes, meaning their Model 3 interior has no fiddly knobs or buttons.