In August, I wrote that Nvidia had become the default supplier of the chips behind advanced driver assistance for legacy automakers and Chinese car companies alike. These chips are the in-car computers that read camera and sensor data to decide when to steer, brake and accelerate in hands-free Level 2+ driving systems. Automakers are planning to use the same chips for eyes-off driving as well.
In October, I compared Chinese battery-maker CATL to Intel in the personal computer space when PC makers lived on thin margins, while Intel and Microsoft captured most of the profit.
A recent Volvo announcement brought those two memos together for me. On October 15, Volvo expanded its Nvidia partnership to use Nvidia's chip, sensor design and driver assistance software.
Volvo's head of software development, Alwin Bakkenes, told Kirsten Korosec of TechCrunch that Volvo has become a "full-tech stack company." In the same interview he said Volvo will standardize more on Nvidia's design, sensor set included.
GM made a different choice. It is buying Nvidia's Thor chip for its 2028 cars, but running its own software on it.
In 2005, Apple made a similar choice to GM when it moved the Mac computer to Intel chips, but kept its own operating system. Owning that software is what let Apple leave IBM's chips for Intel's.
By 2012, Asymco's Horace Dediu estimated Macs earned about 45% of the personal computer industry's operating profit with about 5% of the units sold, more than the top five Windows PC makers combined.
This TaaSMaster memo explores what Apple's experience suggests about who captures the revenue and margin when automakers use Nvidia's chip and software, and when they decide to only use the chip.
Is Nvidia Really the Default Supplier I Described in August?
The map is more divided than I suggested. BMW named Qualcomm its lead supplier of these chips for the next decade. Volkswagen's software unit signed with Qualcomm in 2022, and its Porsche and robotaxi programs run on Mobileye.
Tesla designs its own chips. Rivian is planning to replace Nvidia with its own processor on its R2 vehicle starting late this year. In China, Nvidia held 50.9% of driver assistance chip installations in April. But Horizon Robotics is gaining fast, according to NE Times data.
Is Nvidia the Wintel of the Car?
In the personal computer business, Intel supplied the chip and Microsoft supplied Windows, the software operating system (Intel + Windows = Wintel). Compaq, Dell and HP bought both, and most of the profit went to Intel and Microsoft.
Volvo buying Nvidia's chip and software looks similar at first. But Windows and an Intel chip were essentially the entire PC. Nearly everything a buyer paid for ran through Microsoft and Intel, which left PC makers little to compete on except price.
Nvidia controls one important feature of a car. The body, powertrain, ride, interior, safety engineering, styling and brand stay with the automaker.
Nvidia's scope could grow, however. GM says the Thor-based central computer will run sensor fusion and machine-learning inference across the vehicle. If the driver assistance chip becomes the car's central computer, Nvidia's share of what the car does grows with it.
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What Does Each Automaker Gain and Risk?
Volvo's approach buys speed. It gets eyes-off capability without funding its own chip and software program, and it shares development cost with every other Nvidia customer.
The risk is that driving behavior starts to converge across every car built on the same Nvidia design. Pricing power on that design sits with Nvidia.
GM's approach keeps the software. GM owns how a Cadillac drives, the feature roadmap and the data behind it.
At GM's October 21 technology event, chief product officer Sterling Anderson said GM is not building a Level 3 system. He described the middle levels of automation as a valley GM will skip, going straight to highway driving that needs no supervision, MotorTrend's Edward Loh reported.
Anderson also told Reuters that GM is building its central computer software in-house, saying "the world opens up when you control the software across the system." That is close to Apple's argument for keeping the Mac's operating system.
Like Apple, GM can change chip suppliers more easily because it owns the software. That independence costs money. GM has to pay its own software engineers and keep their work competitive with Nvidia's.
GM's eyes-off system builds on technology from Cruise, the robotaxi business GM shut down in December 2024. GM folded Cruise's engineers into its work on eyes-off driving for cars people own.
Tesla and Rivian build both, their own chips and their own software. They keep the revenue on the whole system. Apple made that move too. But it happened much later, in 2020, when the company had massive scale.
Tesla and Rivian are attempting it at far lower volume. In fact, Musk has said Tesla's next chip, AI5, won't even go into its cars first.
What If Buying the Whole Stack Is the Disciplined Choice?
There is a strong case for Volvo's choice, and it starts with what Nvidia did in August. It released its Alpamayo software models under an open commercial license that lets automakers fine-tune them on their own fleet data and own the models they build.
Compaq could never modify Windows. Volvo can modify Alpamayo. That makes Nvidia's stack closer to a shared starting point than to a rented operating system.
Scale is the second argument. An automaker Volvo's size may never sell enough cars to justify designing its own chips, or to fund a software team at GM's level.
Another argument is that hands-off and eyes-off driving assistance may become standard equipment, the way antilock brakes did. If that happens, neither Nvidia nor the automaker will earn much on it. The margin moves to brand trust, which stays with the automaker.
Who Captures the Revenue Once the Car Can Do the Driving?
Apple's experience suggests keeping the software. Nvidia is opening its software to everyone. Microsoft charged for every copy of Windows, while Nvidia offers its Alpamayo models under an open license and sells the chip they run on.
If that software becomes something every automaker can start from, the half Apple kept may not be the half that earns the money in cars. The question for GM and Volvo is who captures the revenue once the car can do the driving. Will it be Nvidia, the automaker, or maybe even both?
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Framework Reference
This memo revisits the compute section of "The Level 3 Divergence" (August 17, 2026), which described Nvidia as the default supplier of driver assistance chips for most of the industry. The Intel comparison extends "New Powertrain. Same Car Business." (October 19, 2026), which compared CATL's position in EVs to Intel's in PCs.
The margin capture question follows "The Platform Belongs to Leapmotor. The Brand Belongs to Stellantis. Where Does the Margin Go?" (April 20, 2026), which asked the same platform dependency question about vehicle platforms rather than driver assistance software.
Source Attribution
Tracking Disruption in Global Autos