The automotive industry loves to speak about its “AI revolution,” yet a new study released Monday paints a far more restrained picture. Despite the hype and ambitious public statements, only a tiny fraction of automakers are likely to sustain meaningful artificial intelligence investments in the coming years. At NewsTrackerToday, we see this as an early indicator of a deeper shift: the sector is moving toward a split between companies truly capable of building an AI-driven future and those merely experimenting on the surface.
According to Gartner’s latest forecast, by 2029 only around 5% of automakers will maintain a high pace of AI investment – a dramatic drop from more than 95% today. The gap is staggering and suggests that many companies either overestimated their technological capacity or underestimated the depth of organizational transformation required to integrate AI at scale.
The research highlights a crucial point: only automakers with strong software foundations, technologically adept executive teams, and a consistent long-term AI strategy will emerge as leaders. This marks a sharp departure from the industry’s historical identity, where mechanical engineering defined excellence and software was a supplementary layer rather than the core.
The divide is already visible. Traditional giants like Volkswagen, Toyota and Stellantis continue struggling to catch up with digitally native competitors such as Tesla and BYD – companies built around software architectures rather than manufacturing legacy. While legacy OEMs invest in coding talent, form AI labs and modernize IT stacks, their corporate structures still resemble industrial-age hierarchies, making true transformation slow and politically difficult.
Gartner analyst Pedro Pacheco noted that many traditional automakers genuinely want to evolve, yet face internal resistance, outdated corporate logic and siloed engineering cultures. As he put it, success requires becoming a “digital-first organization,” where software is not an afterthought but a structural priority – up to and including having software leadership report directly to the CEO.
At NewsTrackerToday, we interpret this not merely as a technological issue, but as a structural one. The AI gap in automotive is widening not because of who has better chips, but because of who has the organizational courage to reinvent themselves.
As technology analyst Sophie Leclerc explains: “AI creates enormous opportunities, but only for companies that can think in software-native terms. Automakers where software teams sit beneath mechanical departments are structurally destined to lose to companies that build products around digital platforms.” Beyond technology, the economic pressure is intensifying. Investors grow increasingly impatient with slow-moving transformations. Integrating AI into automotive operations demands substantial capital, cross-industry coordination and a redefinition of the vehicle as a software ecosystem, not a physical product.
NewsTrackerToday’s chief economic analyst Ethan Cole adds: “Automakers that fail to evolve into technological ecosystems will inevitably face market-share erosion. AI investment is no longer a fashionable initiative – it has become the minimum price of survival.”
Gartner’s warning, therefore, reads less like a forecast and more like a structural ultimatum: the coming decade will mark the industry’s first true digital divide. Some manufacturers will reinvent themselves around software, while others will remain metal assemblers in a world increasingly shaped by code.
From our perspective at News Tracker Today, success in automotive AI will not depend on size, production volume or legacy reputation – but on the willingness to rebuild culture, processes and leadership around digital-first thinking. AI is no longer optional. It is the gateway into the next era of mobility, and only the few willing to commit fully will belong to that critical 5% shaping the future of the global car market.
