The automotive industry has proven to be a turbulent and complex environment where innovations occur as incremental product improvements, co-developed with external actors. Volvo Cars is one of the important multi-national players in the automotive market, creating world-changing innovation, and currently adapting to the increased connectivity by integrating over-the-air methods for distributing car software. The digital transformation has forced automotive manufacturers to rethink what creates value in today’s digital world and put the existing capabilities to the test. In this study, we explore the current challenges in the complex ecosystem of the automotive sector and how digital technology is perceived, introduced and adopted in a setting typical for the industry. Our results suggest that the management recognizes the vast potential from the increased connectivity, however adopting over-the-air software updatability is characterized by lack of sound business cases and unclear strategic direction. In order to meet the challenges, we consider it crucial that Volvo engages in the development of strong capabilities for integrating, building and reconfiguring its core competences while focusing on exploring external sources of digital innovation.