Ten years from now, cars probably won't look much different than today--on the outside. But, they'll be completely different on the inside.

According to Philipp Radtke, a principal in the Munich office of McKinsey & Co. (New York), electronics will no longer be a discrete component of automotive production. Instead, it will be integrated into the overall construction of the car. "Mechanical connections that have been the basis of cars since they were first introduced will be replaced by electronic connections," says Radtke. For example, the traditional steering column will be replaced by a system that sends electronic signals to each wheel to control the steering.

"Mechatronics will lead to drastic changes in the skills engineers are going to need," predicts Radtke. He defines "mechatronics" as "the integration of electronics into the mechanics of a car."

Radtke believes the trend toward mechatronics could set off a seismic shift in the way cars are built and who builds them. "What OEMs do best is integrate the systems the suppliers send them; they put pieces together," he explains. "But, those pieces will be disappearing and replaced by electronics, which is something that OEMs don't know as much about. The suppliers, who do know about electronics and are developing them now, could be in a position to usurp some of the role that OEMs have."