future tech
Prepare Now for the Mobility Revolution by crai s. bower
M
obility resides at an inflection point not seen since the advent of the assembly line, or perhaps even the combustible engine. Though the mature automotive market moves forward at a pleasant pace, everything is about to change. Like most revolutions, there are multiple and diverse reasons, from the physical to the philosophical to the players. Though the challenges for traditional automotive companies are undeniable, Neal Ganguli, managing director at Deloitte Consulting LLP, believes the future of mobility presents unparalleled opportunities for companies that are prepared for the mobility revolution. “There’s no question that the traditional automakers and suppliers that are taking aggressive standpoints will be part of the new ecosystem,” says Ganguli, who leads the automotive supplier practice for the U.S. auto consulting arm and has studied the American automotive industry for more than two decades. Ganguli and his team cite several key indicators, converging forces that will likely radicalize the future of mobility. The revolution began with new powertrain technology, specifically the battery and fuel-cell electric vehicles that immediately increased energy efficiency and lowered emissions, leading ultimately to new vehicle design. The introduction of lightweight materials allowed for larger rechargeable batteries by reducing structural weight without sacrificing safety. “These changes are happening faster and sooner than many people thought,” Ganguli says, citing both traditional manufacturers as well as industry disruptors like Tesla. The disruptors, Tesla, Google, Amazon, even Apple Inc., are driving innovation as well as completely new paradigms of mobility such as autonomous cars, trucks and drone delivery systems. These companies are well-skilled at raising capital to pursue such innovation, due in no small part to their excellent track records. Of equal
importance, they are not the traditional automotive industry, so they have no constraints. The digitization of the automobile is yet another example of the disruptor’s influence. Wi-Fi vehicles possess the potential to communicate with each other, increasing safety as well as information access for drivers. The very technology that allows today’s drivers to avoid upcoming accident scenes may someday eliminate the accident altogether because of inter-vehicle location sensors and other forms of V2V communication. Ganguli sees “connected cars” as another huge potential growth opportunity. “The [connected vehicle] can be captured in so many different ways including digitization, telematics, data analytics and mobile enabling, among others,” he says. “These are opportunities with potential profits that could be several times the current rate.” According to the Deloitte consultant, this hugely changing channel involving players from technology and digital sectors will no longer be based on traditional B2B and B2C segmentations, but will appear as integrated systems due to shifting mobility preferences. This disruption, largely the result of the millennial generation’s changing mobility preferences and the rapid advances in connectivity and other technologies, may be the single-greatest change in the American driver profile since mass-produced cars first appeared in American driveways. Whether opting for ride-share or car-share programs, the status of vehicle ownership is beginning to disappear. “Our research reveals that millennials may no longer value the asset of vehicular ownership, preferring to purchase mobility instead,” Ganguli explains. “Due to urbanization, as long as the experience is acceptable, they see no reason to own an asset that costs a lot as long as they are getting mobility by other means. This shift helps to eliminate congestion, getting them where they wish to go faster, and
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