Automakers face big challenges as they look to tech solutions

|By:, SA News Editor

Recall worries hit shares of Toyota (TM -1.5%) and Ford (F -0.5%) in early trading, while General Motors (GM -2.2%) has been stung by a harsh Morgan Stanley downgrade on top of its own recall crisis.

A common thread between the spate of recent recalls and the line of reasoning behind the MS downgrade is the need for automobile manufacturers to upgrade and integrate technology inside of vehicles. There's a disparity on the design side between risk-tolerant tech firms and risk-averse automobile companies that could worsen as software fixes become part of the recall atmosphere.

"There’s no doubt the future of the industry is heavily dependent on building a bridge between Silicon Valley and the auto industry," notes Delphi's chief technical officer.

What to watch: Today's faulty ignition switch could be tomorrow's coding error if the transition isn't done right.