New challenges for the automotive industry

I am not a big historian of the automotive industry, but the upcoming changes are obvious to even an ordinary car lover. Soon, we start calling all of this mobility industry instead of the automotive industry.

Despite changes in the automotive design, three major transformations await us in the future.

Technological changes:

Electric cars are already a reality, but you may be surprised that the German legislators want to allow to use only zero-emission vehicles in Europe by 2030. It means, manufacturers should stop selling cars with internal combustion engines (ICE) already now because only 14 years remain to the ban. Maybe they will buy all the previously sold cars, or maybe introduce a tolerance ICE period? Imagine the ICE tolerance parade in the streets of Berlin.

Semi-automated vehicles are also a reality even though we still have to wait for self-drive, no matter how much Uber wants to get rid of drivers as soon as possible. Whether Uber self-drive taxi or Ugly Potato or traditional car manufacturers release fully robotic cars, cannot be predicted, maybe some sort of a mix awaits us in the future. In terms of logistics, modular vehicles will be the most optimal solution for cities. The biggest challenge will be to permit a person to drive in the robocar environment, as computers are predictable unlike people.

Interconnected cars – car sensors connected in the common network – will interact with each other, with environmental sensors (Internet of Things), and with you. Where, how, when to reach the goal; no milk is left in your fridge, – will be the business of your digital assistant that will manage all our surrounding devices, therefore, a car will become just another appliance in your everyday life. Other vehicles communicate within the same network, and apparently private cars will turn into the last mile service, or simply remain as an image element, like before. Although some automotive part manufacturers such as Good Year expect their tires to communicate with each other and with other tires. It is quite strange, but probably my brake pads will soon notify me with a message on Facebook timeline about having booked themselves for service.

After all, our curiosity will tempt us to check what a robocar will do if I.... (think for yourself). 

Habit changes:

The first strange feeling will be riding without driving, without even the driver's help. If the taxi has taught us not to drive, the first attempts to rely on computers will at least look strange. Those of us who like driving will face a ban of driving in certain areas or at certain time, so that the human factor does not drive the robocars mad. After all, our curiosity will tempt us to check what a robocar will do if I.... (think for yourself). Apparently, this will be the first real examples of mass social robotics (robot relationship with human).

Because cars will no longer be sold as assets but will provide transportation services, this will change our relations with the car. If a different “box” arrives to you every day, personalities and sentiments will disappear. The car will “know” when and how it is fastest or cheapest to reach your destination. Booking or parking problem will no longer be your problem, but the car’s business. Vehicle maintenance, battery energy, saving property will no longer be your headache.

But somewhere deep inside your DNA you will still have a social status gene, and uniqueness will remain the engine of evolution. But if driving becomes more of a hobby rather than a necessity, the image of a luxurious car will shift from super car to luxury. Unitary autonomous luxury “boxes” will shuttle in the streets drawing attention of prying mediocrities to themselves. When super car and driving enthusiasts can enjoy closed routes, private streets or even highways.

 Economic developments:

The entire automotive industry should change dramatically: leasing and insurance companies, auto-dealers, parking and driving training companies, auto-registers, fuel service stations, traffic police, street signs, drivers, lawyers, maintenance, ambulance – all things change very quickly. Participants of the automotive industry with billions of cars on the market will be forced to find their niches in this new transformation. New market players will occupy these jobs as mobility providers by combining different modes of transport and services.

Arrangement of logistics for cities will free up parking spaces and streets for residents, pollution reduction will make cities more attractive. Remote jobs will become increasingly popular, thus contributing to the reduction of traffic jams (peak hours is the problem when everyone at once as to go to/from work)

Car dealers will rejoice at the increased revenue, while the service users will be happy about the significant reduction of costs (a paradox of which I have already written, so to avoid repeating myself, please read here)

Already today, car manufacturers and car dealers are changing car sales strategies from traditional advertising to interactive test-drive advertising. 

How all of this will transform from the automotive to the mobility industry? You will agree that not all cars will become electric, self-driving and interconnected in 5 years. The transformation will be gradual and old cars will have to continue living their lives, they will be transformed later based on the new traditions. When car manufacturers stop producing old-fashioned cars and switch to next-generation mobility services? Apparently, yet for another 20 years we will see them, until the day comes when self driving is forbidden on the streets.

Another trend which is worth noting – new brands in car production. As the Internet accelerated the exchange of knowledge and availability of information, the myth of the complexity of automotive manufacture was dispersed. After all, the automotive industry has long been left with only the brand and creative functions, while all other parts are made by subcontractors, and even the assembly of cars and their components is outsourced. Soon, we will see new brands which we don’t even have to buy, just use them as needed. For example, Amber Mobility. Already today, car manufacturers and car dealers are changing car sales strategies from traditional advertising to interactive test-drive advertising. Thanks to car sharing platforms, in any country of the world the car manufacturer can offer a test-drive presentation of a new model as self-service and collect the tester driver details and provide them the test-drive results in real time. Not to mention the new car manufacturers who do not have dealer's network yet. Car sharing platforms in any city can connect your several hundred cars to the Internet and let the urban population drive them.

These brand ambassadors will be better carriers of advertising compared to traditional advertising. Experience sharing connected in the connected world is the most effective path to conversion. Nobody has cancelled the word-of-mouth, but maybe we should be calling it the word-to-share. So do not fear that the Google potato will kidnap us for a ride tomorrow, from behind a corner, – it will be a gradual transformation.

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