The dogma that 'cars won't become smartphones' has been overturned. If Tesla is the iPhone, who is the Android of the EV world?
'Cars are things that carry lives. They consist of 30,000 parts and require advanced 'craftsmanship' (suriawase). Therefore, modularization like that seen in PCs or smartphones will not happen, and IT companies cannot easily enter the market.'
Until a few years ago, experts and media in the Japanese automotive industry spoke in unison. But now, that 'dogma' is shaking significantly. This is because the waves of EV adoption and SDVs (Software-Defined Vehicles) have fundamentally overturned previous assumptions.
EVs have become 'smartphones on wheels,' not 'giant remote-controlled cars'
If you unravel the structure of an EV, the reason is obvious. The moment the massive and complex internal combustion engine is removed, replaced by a simple configuration of a battery, motor, and control board, the car transforms from a 'crystallization of craftsmanship' into a **'giant computer on wheels.'**
'Smartphone-ization' here refers to the following four points.
Modularization of hardware
The interchangeability and standardization of parts increase, leading to greater freedom in combinations.OS and software are the core of value
Rather than mechanical performance like 'driving, turning, and stopping,' the software experiencethat controls these and keeps them constantly updated becomes the differentiator.Value continues to grow after sale via OTA
Performance and features continue to evolve after purchase through over-the-air (OTA) software updates.Ecosystem is the source of competitiveness
An 'ecosystem' that goes beyond the car itself, including charging networks, apps, and data integration, determines the winner.
With the progress of hardware modularization, the source of a car's value has completely shifted from mechanical mechanisms to OS and software.
The 'iPhone-ization of automobiles' that Tesla proved—but the king is wavering
Tesla was the first to prove this paradigm shift in the automotive industry.
Tesla's Elon Musk viewed the vehicle as a 'giant computer on wheels' and built a model where performance and autonomous driving features continue to evolve after sale via OTA. The way it formed a powerful ecosystem with its proprietary 'Supercharger' fast-charging network and vertically integrated everything from hardware to software was the same structure as Apple, which once rewrote the rules of the mobile phone industry with the iPhone.
However, as of 2026, there is a serious crack in that 'iPhone'.
In 2025, Tesla's deliveries fell for the second consecutive year, remaining at 1.64 million units annually (an 8.6% decrease from the previous year). In Europe, registrations plummeted by 39% throughout the year. According to brand research firm Brand Finance, Tesla's brand value fell by approximately 36% ($15.4 billion) in 2025, eroding to $27.6 billion, less than half of its 2023 peak ($66.2 billion). This is the result of Musk himself standing at the forefront of politics as the head of DOGE (Department of Government Efficiency), with his words and actions alienating both existing and potential customers.
Furthermore, in 2025, BYD sold 2.26 million units annually, surpassing Tesla on an annual basis for the first time. The reality that 'the iPhone has lost its market lead to the first Android device' is happening right now in the EV market.
The fact that Tesla is deepening its bets on 'Robotaxis' and 'humanoid robots (Optimus)' is, in other words, because growth as a pure EV manufacturer has hit a ceiling.
The true identity of the 'Android of the EV world' that is already baring its fangs
So, who is the 'Android of the EV world' that acts as the counter-axis to Tesla?
What those who believed 'cars won't become smartphones' overlooked most was the cold reality that 'separation of OS and hardware (horizontal division of labor)' could also happen in cars. The entity most blatantly executing this structure is the Chinese telecommunications giant, Huawei.
Huawei's strategy is consistent. After declaring that it 'will not manufacture cars itself,' it has established a position as a 'Tier 0.5' supplier, going beyond a Tier 1 automotive parts supplier to take control of the manufacturer's very brain.
What they provide are the in-vehicle OS 'HarmonyOS,' the world's top-class autonomous driving system 'HUAWEI ADS,' and core components such as motors and power management. They provide these as a package, forming an alliance called 'HIMA (Harmony Intelligent Mobility Alliance)' that involves automakers.
Currently, seven manufacturer brands have joined HIMA, including Seres (AITO), Chery Automobile (Luxeed), BAIC Group (Stelato), JAC (Maextro), as well as Dongfeng Motor (Yijing), GAC (Qijing), and SAIC-Wuling (Huajing), and the alliance is expanding rapidly.
The numbers are staggering. HIMA's annual sales volume in 2024 was 456,000 units, a 336% increase from the previous year. In 2025, it expanded to 589,000 units, a 32% increase. In the ultra-luxury SUV segment over 5 million yen, the AITO M9 has surpassed the BMW X5 and Mercedes-Benz GLE to take the top spot, sweeping the market regardless of price range. Furthermore, the number of models will exceed 17 in 2026, and the momentum of expansion shows no signs of stopping.
If you install Huawei's system, any manufacturer's car can obtain world-class autonomous driving and a smart cockpit. As a result, automakers are transforming into 'hardware manufacturing factories' like Samsung or Xiaomi in the smartphone market.
What Huawei really wants is 'driving data'
Here, there is a question I want you to stop and consider.
What is it that Huawei really wants to extract from the HIMA alliance?
Just as the true purpose of the 'Android' that Google spread was not the proliferation of devices, but the vast amount of 'search and behavioral data' sucked from them, what Huawei truly wants is 'driving data'.
Route selection, acceleration and braking patterns, and real-time understanding of traffic conditions—these are the ultimate training data for honing autonomous driving AI. The more they participate in HIMA, the smarter Huawei's autonomous driving AI becomes, and the more deeply the participating manufacturers become dependent on Huawei.
Joining HIMA is not just 'outsourcing the brain' for manufacturers, but 'delegating the brain,' and it is a structure from which you cannot escape once you step in. Just as Android cannot function without Google, 'HIMA alliance cars' cannot compete without Huawei.
Japan exploring a 'third way': Toyota's Arene strategy
So, where are Japanese automakers heading?
What should be noted is Toyota's 'Arene' strategy. Arene, developed by Woven by Toyota, is an in-house in-vehicle OS platform that began installation in actual vehicles in 2025. The key point is that it not only supports OTA updates but also envisions an 'open platform' where external developers can develop apps on Arene. Toyota is trying to build its own ecosystem that is neither Tesla's 'vertical integration' nor Huawei's 'horizontal dominance' by creating a 'third OS camp' and bringing in other manufacturers.
In September 2025, Phase 1 of Woven City was completed in Susono City, Shizuoka Prefecture, and demonstration experiments of Arene in real society began. Furthermore, through collaboration with NVIDIA, plans are underway to equip next-generation EVs with an SDV ecosystem that integrates the AI processing chip 'DRIVE AGX Orin' and Arene.
However, the challenges are serious. While Tesla updates its OTA every few weeks and Huawei continues to introduce new features at a furious speed, Arene is clearly lagging behind in both R&D investment scale and development speed. The vision of 'opening up' is correct, but the problem is whether there is enough time left to make it a reality.
Replaying history and the time remaining
What is happening in the global EV market now is that the platform war of 'Apple vs Google (Android)' has a structure that is strikingly similar.
While Tesla aims for the 'pinnacle of vertical integration,' Huawei is sucking up driving data through 'horizontal division of labor' and is catching up fiercely with the evolution of autonomous driving AI. Toyota is aiming for a 'third pole' that threads the needle between them, but the clock has already started ticking.
'Monozukuri' (craftsmanship) is certainly wonderful. However, now that consumers have come to find value in cars in 'software experiences,' it is difficult to stand up to the masters of the ecosystem with that alone.
Look at the fate that befell Japan's consumer electronics industry. LCDs, plasma, OLED—contrary to the pride of 'monozukuri' (manufacturing), manufacturers that failed to seize the platform disappeared one by one.
Of course, unlike consumer electronics, automobiles are subject to strict safety regulations and certifications, complex sales channels, and national industrial policies, so platform dominance will not happen immediately. However, that 'grace period' is definitely shortening.
The 'Android of the EV world' is not a future threat; it is already here. An allied force named HIMA is already restructuring the existing automotive industry from within. The survival competition over whether to become 'just a hardware pipe' has already entered its final phase.
#EV #Tesla #Huawei #SDV #Automotive #Toyota #BusinessModel #ChineseTech
