Some predicted disruptive trends for the automotive industry that may lie ahead
1. Autonomous technology coupled with connectivity is predicted to allow the automobile to become a platform for drivers and passengers to use their time in transit to focus on various media services or dedicate this time to other personal activities.
2. The increase of vehicle sharing and e-hailing are predicted to emerge in densely populated megacities. This may lead to a decline of private-vehicle sales in those heavy populated areas, but this decline could be offset by increased sales in shared vehicles that need to be replaced more often due to lack of ownership pride, higher utilization related to greater wear and tear.
3. Multiple modes of transport solutions, like goods and services delivered to you rather than picked up. A range of diverse, on-demand mobility solutions, especially in dense urban environments that proactively discourage private-car use with parking restrictions, congestion charges and road taxes.
Flexibility to choose the best solution for a specific purpose, on demand, door to door and located and administered via your smartphone.
4. The difference between the urban and rural requirements and the future business opportunities that lie within these markets. Automotive companies will need a product based primarily on the population density.
In megacities like London or New York, car ownership has become a burden. However, rural areas & small towns, the private-car ownership will remain a strong preference.
5. Advanced Driver Assistance Systems (ADAS) are here now but Fully Autonomous vehicles are still a few years away. ADAS is endeavouring to prepare the watchdogs, buyers, and businesses as they work towards a fully autonomous solution.
Regulation and consumer acceptance could bring up additional hurdles. However, if these challenges are addressed, autonomous vehicles could offer a disruptive trend to the market and for buyers, especially the ones that dislike driving.
6. The Electric Vehicle is considered a disruptive element, which will be driven by stricter emission regulations in megacities. However, this technology is still working on finding solutions for better batteries, lower battery costs, faster charging, better infrastructure, longer range, and increasing consumer acceptance, which continues at disappointing rates.
If this is solved it would create a new momentum for electrified vehicles. It is important to note that currently electrified vehicles include a large portion of hybrid electrics, which means that even beyond 2030, the internal-combustion engine will remain very relevant.
7. Is a vehicle about hardware or software? The automotive industry has seen very little change or consolidation so far. This question will force traditional car manufacturers to compete on multiple fronts.
Mobility providers & tech giants like Apple, Google and Tesla will increase the complexity of the market. Traditional automotive companies are under continuous pressure to reduce costs, improve fuel efficiency, reduce emissions, and become more capital-efficient.
This should lead to consolidation and partnerships as software competence is now becoming one of the most important factors for automakers. Vehicles will be required to be integrated into the connected world, they will have no choice but to participate.
8. The attack from non-traditional players, which is underway with Tesla, Apple and Google. These guys initially focus on a select economically attractive part of the market and build from there. It is also possible that players we have not heard of yet may enter into the game.
What about the sleeping giant that is the Chinese car manufacturers, as they could also leverage this disruptive market to play a role? The Automotive companies we know and have grown up with cannot predict the future of the industry with certainty. They can, however, make strategic moves now to shape the industry’s evolution and stay ahead of the inevitable disruption if they choose to.