Modern cars are increasingly defined by software, but automakers are still struggling to integrate it seamlessly. Despite advancements in electric and autonomous technology, the in-car software experience remains frustratingly behind compared to smartphones. Companies like Volkswagen, Honda, Audi, and Mercedes have yet to master this crucial aspect, leading them to invest heavily in artificial intelligence (AI) as the next big frontier.
At CES 2025, AI dominated discussions within the automotive industry. Every major brand emphasized its commitment to integrating AI into vehicles, promising more personalization, conversational interfaces, and smart recommendations. However, most automakers are still figuring out how AI can provide meaningful value to drivers beyond flashy but impractical gimmicks.
AI in Cars: A Feature in Search of a Purpose
Automakers like Volkswagen and Mercedes have already introduced AI-powered voice assistants into their cars. Volkswagen integrated ChatGPT into its infotainment system, allowing drivers to interact with the AI via voice commands. However, the practical use cases remain unclear. ChatGPT excels at summarizing information, generating text, and answering general knowledge questions, but these capabilities don’t translate well to the driving experience.
For instance, Volkswagen claims its AI assistant can provide information on tourist attractions, historical events, and even solve math problems. While these features might sound impressive on paper, they do little to improve the core driving experience. Drivers don’t need a complex AI to answer trivia questions when they already have smartphones with built-in assistants like Siri and Google Assistant.
Mercedes, on the other hand, is betting on Google’s Gemini AI to enhance its in-car experience. Mercedes CEO Ola Källenius describes the system as “whatever you want can be done,” yet he struggles to articulate what exactly that means for drivers. The most practical example offered was AI-powered navigation that could find charging stations based on user preferences. This at least represents a step toward solving real-world problems, but it remains unclear if it will be a game-changer.
Sony-Honda’s Afeela: A Futuristic Gimmick?
Sony-Honda Mobility showcased its Afeela EV at CES, touting AI as a core selling point. However, the demonstration left much to be desired. One of the AI’s highlighted features was the ability to “make the theme more Japanese,” which simply changed the infotainment wallpaper to one inspired by the PlayStation game *Ghost of Tsushima.* While visually appealing, this feature hardly justifies AI integration.
The AI also demonstrated basic conversational abilities, such as asking a driver how they were enjoying CES. While this adds a layer of engagement, it lacks real utility. The ability to adjust ambient lighting and recommend songs—features that Sony-Honda also showcased—are already available through simpler recommendation algorithms in existing streaming services. These implementations suggest that many automakers are still struggling to find meaningful applications for AI in cars.
BMW and Honda Join the AI Hype
BMW’s next-generation iDrive system is also set to integrate AI for personalization. The company showcased AI-driven customization of driving modes and interior settings. However, modern vehicles already offer driving modes like Normal, Sport, and Eco, often with adaptive settings that automatically adjust based on road conditions. Branding these minor adjustments as “AI-powered” feels more like a marketing strategy than a technological breakthrough.
Honda, too, is diving into AI with its new Asimo OS for the upcoming 0 Series EVs. Honda’s pitch revolves around continuous software updates that adapt to the driver’s preferences over time. While this sounds promising, the press release mainly emphasized vague terms like “digital UX” and “personalization,” echoing the same general language used by other automakers.
The AI Buzzword Problem
Many car manufacturers seem to be using AI as a catch-all term to appear technologically forward-thinking rather than offering truly transformative innovations. Faraday Future, for example, claims to be building the world’s first “AI EV” and even coined the term “Range Extended Artificial Intelligence EV” (RE-AIEV). However, when pressed for details on how AI enhances the vehicle, company representatives failed to provide any concrete examples.
This trend suggests that automakers are still in the early stages of AI integration. While AI can undoubtedly play a role in improving various aspects of the driving experience, companies need to focus on solving real-world problems rather than adding AI for the sake of marketing.
Where AI Can Actually Make a Difference
Despite the current AI hype, there are areas where AI is already making a meaningful impact in the automotive industry. The most significant application is in driver-assistance and autonomous driving systems. AI is increasingly being used to power “Level 2 plus” driver-assist features, which require human supervision but significantly reduce the burden of highway driving.
Tesla’s controversial “Full Self-Driving” system is a well-known example of AI-driven driver assistance. While Tesla’s marketing has been criticized for overpromising, the underlying AI technology has made noticeable improvements in lane-keeping, adaptive cruise control, and object detection.
According to Ed Kim, President of AutoPacific, AI-powered safety features are what consumers genuinely want. While many buyers may not be actively seeking AI, they do want vehicles with enhanced safety, automated braking, and intelligent cruise control—features that increasingly rely on AI algorithms.
AI’s Role in Car Manufacturing
Beyond driver assistance, AI is also transforming vehicle design and manufacturing. Companies like Scout Motors are using AI-driven simulations to optimize aerodynamics and crash-test performance. AI can rapidly analyze design variations, reducing development time and allowing automakers to create safer, more efficient vehicles.
Similarly, AI-driven supply chain management is helping automakers streamline production and reduce costs. As AI continues to evolve, it is likely to have an even greater impact on manufacturing efficiency and quality control.
The Future of AI in Cars
While the current AI implementations in infotainment systems leave much to be desired, AI’s role in the automotive industry is only beginning to take shape. The real breakthroughs will likely come from AI-driven autonomy, safety systems, and manufacturing innovations rather than voice assistants that can change ambient lighting.
That said, some promising AI features are emerging. Mercedes’ “Conversational Navigation” system, powered by Google’s Gemini AI, represents a practical step forward. This feature allows drivers to request charging stations near specific types of restaurants with dietary options for passengers—a genuinely useful function that traditional navigation systems cannot easily provide.
The key to AI’s success in cars will be solving real problems, not just adding futuristic-sounding features. Consumers don’t need AI to summarize historical events during a commute; they need AI that helps them find the best charging station, optimize driving routes, and enhance vehicle safety.
AI has the potential to revolutionize the automotive industry, but today’s implementations often feel more like marketing gimmicks than meaningful innovations. Automakers must shift their focus from vague promises of “personalization” to developing AI-powered solutions that genuinely improve the driving experience.
As AI technology matures, we will likely see a clearer distinction between hype and real-world benefits. Until then, car buyers should approach AI-powered features with skepticism and look for practical applications that truly enhance their vehicles. The future of AI in cars is promising, but for now, it remains a work in progress.