In February, Franco-Japanese car behemoth Renault-Nissan opened a new, 26,000-square-foot research center in, of all places, Sunnyvale, Calif. It turns out that it is joining a long list of auto companies that have recently opened or expanded R&D shops in Silicon Valley. The Bay Area’s pool of technical talent has long attracted outside industries. But recent advances in Internet-enabled cars, electric vehicles, and driverless automobiles — not to mention local firms Google and Tesla — are fueling automotive innovation here.
1. BMW
Mountain View, est. 1998
The German car company first opened in Palo Alto but moved into a larger space in Mountain View in 2011. It has since brought locally developed apps like Pandora to BMW models.
2. Ford
Palo Alto, est. 2012
Ford’s first dedicated R&D plant on the West Coast is focused on OpenXC, an open platform that developers can use to create apps for cars.
3. General Motors
Palo Alto, est. 2006
Located in a former Hewlett-Packard production site, GM’s outpost scouts for local partners. In 2011 it invested in San Francisco-based carsharing service RelayRides.
4. Google
Mountain View, est. 1998
The search giant didn’t invent driverless cars, but it is the driving force behind the dream. Nevada, Florida, and California have now legalized road-testing them.
5. Renault-Nissan
Sunnyvale, est. 2013
The new Nissan location has already made its first big hire: Maarten Sierhuis, an artificial-intelligence expert and former NASA scientist, will lead the lab.
6. Tesla Motors
Palo Alto, est. 2003
The startup that launched vowing to take on Detroit has sold about 10,000 electric cars. It expects to turn its first quarterly profit later this year.
7. Toyota
Mountain View, est. 2012
Toyota is working with local companies and universities to develop so-called infotainment systems that can connect vehicles to apps and the web.
8. Volkswagen
Belmont, est. 1998
Volkswagen has one of the largest — and oldest — R&D centers. In 2005 a self-driving VW SUV, developed with Stanford, won the DARPA Grand Challenge.
This story is from the April 29, 2013 issue of Fortune.
