Here's how you can tell there's a seismic shift underway in the auto industry: A slew of automakers have set up R&D centers in Silicon Valley, hoping to be closer to the developers and the technologies they need to remain competitive.
In the past five years, BMW, Honda, Hyundai, Mercedes-Benz, Renault-Nissan and Toyota have all opened research-and-development facilities in the San Francisco Bay Area. Last year, Ford followed suit, as did General Motors, which opened an "Advanced Technology Silicon Valley Office" in Palo Alto to develop a Web browser for Cadillac's CUE in-vehicle infotainment (IVI) system.
Those moves come as Apple and Android fight for a presence on many new cars' navigation screens -- both Ford and Fiat Chrysler announced at CES 2016 that Apple's CarPlay and Google's Android Auto would be coming soon to their vehicles. (Several other companies, including Honda, Volkswagen and Hyundai, already offer that technology.)
Google is pressing ahead with its work on autonomous cars (and Ford is planning to put a self-driving vehicle of its own on California streets this year). And Tesla Motors continues to update its all-electric vehicles with new autonomous features.
"I think just about everybody is [in Silicon Valley]," said Egil Juliussen, an automotive analyst at IHS Technology. "You need to be there to learn about what's going on. You can't learn those things remotely."
Not only are automakers opening R&D facilities, they're also recruiting talented engineers, said Jon Allen, a principal at Booz Allen Hamilton, a management and technology consulting firm.
"This isn't your grandfather's automotive company anymore," Allen said. "The [carmakers] are moving away from simply being hardware manufacturers to becoming software developers. Fundamentally, the auto industry cannot be seen as just 'auto makers' any more. They're mobile developers."
That view helps explain why a former Apple engineer now runs Ford's new Palo Alto R&D center. And it explains why Apple hired Doug Betts, a former Fiat Chrysler executive in charge of global quality, adding to speculation that Apple is seriously working on its own autonomous car.
The Wall Street Journal and other sources have reported that Apple plans to ship a car in 2019. (It's part of a not-quite-secret project known as Titan.)
"Look at who Apple is hiring," said Allen. "They're hiring auto executives."
As cars become more technically advanced, software becomes an increasingly important differentiator between brands. The average vehicle now has about 50 processors that control everything from engine control units (ECU) to so-called advanced driver assistance systems (ADAS), such as parking assist and adaptive cruise control.
ADAS technologies and fully autonomous vehicles are now a focus for Silicon Valley developers as automakers craft code that connects the cameras, sensors and other on-board systems. That hardware, married to that code, is what's needed for a car to drive itself.
Google has been testing self-driving cars in California and Texas over the past year, but analysts say it makes more sense for Google to license its autonomous software and sensor technology to automakers instead of trying to set up its own auto production facility.
"Ford has been more interested in car mobility as a service than any other [automaker]," Juliussen said. "With Google having the most advanced software for driverless cars, it makes sense that they would work together."
Despite speculation in late December that Ford and Google would announce a joint venture to do just that, no such plans were announced. But the prospect of such a deal is likely to push other carmakers to partner with Google or other software developers to speed up their own autonomous vehicle initiatives, Juliussen said.
Ford is also working with software company Pivotal on connected car technologies, which allow vehicles to communicate with each other while on the road.
Meanwhile, inside the car
Another area that's seeing serious attention involves in-vehicle infotainment systems. IVIs typically include navigation tools, displays for video cameras and cellular connectivity, in addition to offering music, video and other types of entertainment.
The leading IVI operating system today comes from QNX Software Systems, which is now owned by BlackBerry. But Linux is one of the fastest-growing alternatives.
The GENIVI Alliance, a nonprofit automotive industry group, has developed an open-source IVI development platform based on Linux.
"The software is really how all the functionality in a car is created," Juliussen said. "That's why it defines the car now. You used to do that with hardware."
Lucas Mearian contributed to this story.