Course Correction: Innovations in Connectivity Will Define the Automotive Industry for the Foreseeable Future
After decades of rinse-and-repeat product launches and predictable consumer demand, the Automotive Industry is poised for a significant course correction. The rise of electrification and connected devices is challenging current business models as newcomers and industry heavyweights alike weigh strategies to capitalize on the future potential of connectivity and mobility trends.
McKinsey & Co states that “the car of the future will be connected—able not only to monitor, in real time, its own working parts and the safety of conditions around it but also to communicate with other vehicles and with an increasingly intelligent roadway infrastructure. These features will be must-haves for all cars, which will become less like metal boxes and more like integrators of multiple technologies, productive data centers—and, ultimately, components of a larger mobility network.” Indeed, automotive businesses of the near-future will have access to a veritable treasure trove of information, from trips taken to payments made and much more. Armed with granular data on a global scale, organizations will force the automotive value chain to evolve and birth disruptive new business models.
As Mobility as a Service continues to flourish despite startup capital burn, the lessons learned will feed the future of personal transportation to drive not only enhanced connectivity, but the consumer experiences the industry has been insofar unable to deliver. “As every vehicle becomes a source for receiving and transmitting bits of information over millions of iterations, safety and efficiency should improve and automakers should be in a position to capture valuable data. Electronic innovations have accounted for the overwhelming majority of advances in modern vehicles. Today’s average high-end car has roughly seven times more code than a Boeing 787.”
It’s clear that vehicle manufacturers understand the importance of these emerging markets, as most if not all have partnered with technology companies in pursuit of harnessing this massive data cache. Likewise, as modern society drifts further towards sweeping technology integration, the importance of vehicle attributes will decrease proportionally with their level of connectivity and convenience features. It is this expertise that manufacturers seek from their newfound alliances and that which will ultimately drive future automotive business models.
“The automobile, mechanical to its soul, will need to compete in a digital world, and that will demand new expertise and attract new competitors from outside the industry. As value chains shift and data eclipses horsepower, the industry’s basic business model will be transformed. Indeed, the very concept of cars as autonomous freedom machines may shift markedly over the next 50 years.” While the direction the industry takes is still up for debate, one thing is certain; the course we take today must address not only current consumer needs but the landscape in the decades to come. As pioneers of automotive blockchain, SHIFTMobility is well positioned to power the automotive industry for this mile and the next by connecting drivers to vehicles, services, and everything else. Learn how at shiftmobility.com