Automakers Will Slowdown on AI Push, Gartner Study Predicts
In Focus
- Gartner study shows only 5% of automakers can sustain AI investment through to 2029
- Study shows tech-savvy leadership and long-term focus on AI are critical to success
- Legacy vehicle manufacturers like Volkswagen struggle to compete with Tesla, BYD
A study by research and advisory firm Gartner predicts that only 5% of automakers will keep the AI push by 2029. According to Yahoo Finance, the study, which was released on December 8, 2025, casts doubts on whether the current AI interest in the automobile industry will deliver long term benefits.
AI Euphoria Hits the Automobile Industry
According to Gartner, the automobile industry is experiencing AI excitement where most car manufacturers are seeking to gain disruptive value without establishing strong AI foundations. This trend makes it difficult for most automobile companies to sustain the strong AI investment needed to realize autonomous driving ambitions over the next five years.
“This euphoria will eventually turn into disappointment as these organizations are not able to achieve the ambitious goals they set for AI,” VP Analyst at Gartner Pedro Pacheco said as stated in a post published on the company website.
Globally, car makers have been rushing to invest in development of AI-powered autonomous technologies to remain competitive. BMW has partnered with Qualcomm to launch an automated driving system, Snapdragon Ride Pilot, which offers hands-free highway driving assistance.
A Strong Software Foundation is Key to Pulling Forward
The 2025 auto industry AI study identified three key attributes of auto manufacturers which are likely to pull forward and deepen the competitive divide in the industry. Such companies have tech-savvy leadership, strong software foundations, and a consistent, long-term focus on AI.
“Software and data are the cornerstones of AI. Companies with advanced maturity in these areas have a natural head start. In addition, automotive companies led by executives with strong tech know-how are more likely to make AI their top priority instead of sticking to the traditional priorities of an automotive company,” Pacheco added as stated in the Gartner statement.
Gartner’s study on the future of AI push by automakers comes a few months after legacy car company Stellantis partners with Pony.ai to accelerate development and deployment of autonomous vehicles in Europe. In this partnership, the Chinese company provides autonomous driving software, Pony.ai Gen-7 robotaxi tech, which provides EV vehicles.
The Tesla, BYD, Volkswagen AI Strategy Comparison
Legacy automobile companies like Volkswagen that are popular for their engineering as opposed to software development are struggling to compete with tech-driven firms such as Tesla and BYD.
According to Gartner, most legacy automakers are attempting to integrate AI in their products by partnering with autonomous driving firms. Earlier this month, Japanese vehicle manufacturer Nissan signed a commercial deal with Wayve to integrate its autonomous driving technology in its vehicles. Wayve started testing its AI-powered self- driving technology on Nissan Ariya electric vehicles in Japan in September 2025.
Gartner says the future of AI in the auto industry requires companies to adopt a “digital-first” approach. This approach enables vehicle manufacturers to prioritize technology at the highest levels and eliminate internal obstacles. The technology research firm predicts that assembly of fully-automated vehicles will become a reality by the year 2030.
