Mobility has gone through several phases of evolution in the past century. Today globalization affects the industry in multiple ways. Digital transformation has enabled our cars to be connected, and many drivers are already enjoying the new features that come with this connectivity. Now over 60% of drivers receive calls through a vehicle interface and, 50% use in-built navigation systems. These figures demonstrate that people are making use of new technology, whether or not they care about the development of connected cars.
The automotive industry is currently undergoing a fundamental transformation. Manufacturers are racing towards the creation of more personalized, frictionless, and safer vehicles, that will provide next-level driving experiences to customers.
To keep up with the fast-paced modern world, the automotive industry has had to take necessary steps towards the many different technological advancements that are now available. Different parts of the world are contributing in various ways to the connected car revolution.
Here are five snapshots of how the automotive industry is moving towards the connected future and how different places around the globe are contributing and adjusting to it.
Shifting The Focus From Hardware To Software
That’s exactly how the revolution started. Automakers were focused only on hardware for decades. That time is over, and today what truly makes a difference is software. Now all of the trends in the automotive industry are about the integration of AI systems or voice-activated personal assistants.
Tesla’s extensive use of the software is what differentiates their vehicles from others on the market. Most vendors used to focus on improving fuel efficiency, durability, and design of their products. The software was merely an accessory to the hardware. However, in our digital world, people have online lives and want to be able to continue them when on the go.
That’s why automotive manufacturers are now following Tesla’s example and have started building “computers on wheels.” The growing predominance of software in vehicles offers many opportunities, as well as challenges, to the automotive ecosystem.
It’s now widely believed that connected vehicles will turn into self-driving ones in about a decade. Google’s prototype of such a car demonstrates the shift, as its hardware is merely a host for the software that drives it.
Europe’s Premium Car Brands
Many of the leading premium car brands are European. Questions have arisen about the role of such high-end brands in the emerging mobility environment. Nevertheless, brands are still important when it comes to decision making when buying a vehicle.
On the other hand, electric-vehicle technology will unlock new levels of vehicle performance, which will make acceleration times once seen only in premium vehicles, easily achievable. The focus of modern consumers will be shifted towards different attributes, such as connectivity and battery performance. Choosing a car will be like shopping for a smartphone.
The most crucial factor when looking for a new vehicle will be its communications with other vehicles and infrastructure, as well as personal assistants. The design has always been an essential characteristic when choosing a car, and it’s expected to continue growing in importance, together with functionality.
Premium customers will be looking for more advanced features such as massaging seats or air purification. They’d like a highly personalized vehicle, suited to their needs. European OEMs will have to generally redefine premium brand standards so that they meet the expectations of modern customers if they want to keep their place on the market.
Where Innovation Is Born – The US
Technological advancements and the evolution of mobility have caused a wave of entrepreneurship and innovation, especially in the United States, quite similar to the one seen in the early days of vehicles about a century ago.
Today, there are thousands of companies whose primary purpose is to pursue vehicle autonomy. They work towards sharing, connectivity, and electrification, investing billions in innovation each year.
Following General Motors’ example with Crouse Automation, American companies are placing enormous investments in futuristic mobility concepts. Many of those investments have been made by companies not originally from the automotive world.
Microsoft’s smart city initiatives and the testing of Waymo – one of the first autonomous vehicles to hit the road – are other initiatives from the US we should keep an eye on. The United States will continue to be a center of innovative ideas for the automotive industry in the years ahead.
China is a leading manufacturing force in almost all industries now. By 2020 the country is expected to account for 59% of global electric car sales. Currently, mini-EVs are extremely popular in China, mostly because they are very affordable, with a starting price of about $6,000. The compound annual growth rate of China’s new electric vehicle market is expected to reach 46% by next year.
With the overall shift in the automotive industry towards such vehicles, China will remain dominant. The leading cause of such a change in the automotive industry is pollution. China has some of the most polluted cities in the world, and together with India, it accounts for 50% of worldwide deaths due to pollution. That’s why China’s government has set a goal to make one in every five vehicles sold electric.
EVs might help with pollution, but that’s not the only challenge that China faces. Commuting is something many people in the country have problems with. The average time Beijing workers spend commuting is 1.3 hours a day. It has made the government invest more in smart infrastructure. Chinese consumers already enjoy the aspects of mobility-as-a-service, so it’s expected that they’ll be receptive to autonomous vehicles as well.
Despite all the challenges, China needs to transform its transportation networks. It will make the adoption of shared electric autonomous vehicles faster there than anywhere else in the world.
Globalization Brings New Players
Brazil is so big that its car and truck production exceeds that of France. Yet the carbon emissions per capita are relatively low. Clearly, EVs aren’t that attractive to Brazil right now.
Instead, their focus is on vehicles powered by sugarcane ethanol, as it’s very inexpensive to produce there, and it’s carbon emissions are similar to those of EVs.
On the other hand, in India, which produces almost as many vehicles as Germany, electrification is still in its early days. This puts them in a terrible position when it comes to power electronics and battery manufacturing.
India’s primary concern is pollution. Major cities are continually looking for ways to lower pollution levels, as it’s currently the most polluted country in the world. Government programs such as the Energy Efficiency Services Limited order thousands of electric vehicles to fight dangerous statistics and try to improve the quality of life.
India could surpass China in size of the car market in a decade, due to the challenges it faces. This drives a massive growth and inescapable need of electrification.
A Global Revolution
The automotive industry today is fundamentally different. Technological advancements such as the Internet of Things and Artificial Intelligence are taking it to a whole new level. The goal of a connected car revolution is now a fact. As you can see from the snapshots above, different parts of the world have their way to adapt and make use of it. However, one thing is for sure, no matter which country they are produced in, vehicles are now all about software.