The Challenge of Digitally Disrupting the Automotive Industry (5 Minute Read)

Posted by Alex Mills-Baker on 26-Jul-2017 11:10:03
Find me on:

We’re living in exciting times, the automotive industry is entering into a period of change and disruption not seen since the motor car first emerged out of Karl Benz’s garage. In the decades since, the car has undergone countless evolutions as the vehicle has been refined and perfected to the pinnacle of manufacturing we see today. However, what we are living through is revolution not evolution.Connected Cars have come a long way since car-phones

The step change that is about to occur means the vehicle’s basic model of being owned by a single individual who utilises it solely as a means of transport is changing. Ride sharing and autonomous robo taxis promise cheap, utilitarian private transport in urban areas whilst the model of ownership will be challenged by car sharing schemes such as zipcar.

The role of the car simply as a mode of transport will change as well. With the ever growing consumer demands on the capabilities of the connected car, especially in developing markets, in the next few decades we could see the automobile become more of a private mobile cinema than something that you drive.

This all brings a number of challenges. It’s clear that the automotive industry is about to go through monumental disruption but we’re already seeing conflict between the modus operandi within digital development circles and those of a more traditional manufacturing industry.

In this article I will examine a few of these from the perspective of a mobility agency and will speculate on what the potential solutions could be.

Development Cycles

The most obvious place to start with the issues facing the automotive industry is the fairly clear fact that a car takes longer to develop than a mobile phone. This immediately raises a problem when trying to interface with the agile delivery models typically utilised by digital development teams. 

The pace of change within digital necessitates the use of agile methodologies, as by the time you’ve finished a development utilising traditional methods the technology has moved on and you’re out of date. However, developing a car takes years and needs a defined target at the start of the process, not a constantly moving one.

The conflict between these two ways of thinking requires careful management and a well thought out change process in order to facilitate successful collaboration. It is essential that the hardware chosen at the start of the development of the car is future proofed against the software which could be required by the time the car is launched a few years later.

Alternatively, a model of continuous improvement could be adopted where every car that rolls off the production line is better than the last. Although this brings fresh complexity to the second hand market, changing the approach from linear to cyclical can bring great benefits. Interestingly, this is how the engineers at Tesla managed to roll new models in under 24 months, applying technology development principles as well owning the entire supply chain to reduce dependencies. The quality of this approach is yet to be fully discovered, but this discussion is most definitely for another day.

Product Life Expectency

The next issue is also linked to the speed of the digital industry vs the automotive, however, this time it’s due to the life expectancy of the product. The average car is expected to last at least ten years whereas anyone who’s owned an old iPhone will know the technology is basically defunct after 5.

The Future of Connected Cars, Tesla Infotainment Surprises

This presents a real challenge as even when you factor in that software can be updated over the air on in-car systems, Tesla is leading the way in this area, and the hardware it runs on will become obsolete long before the vehicle.

I see two main ways to address this but both come with their challenges. The first would be the approach taken by many IoT devices and that is utilising the mobile phone as the processor for any applications and the car being little more than an interface. This would appear to be eminently practical but is likely to be met with resistance by traditional automotive manufacturers who are used to a far greater degree of control. Apple have started to make waves in this area with their car-play SDK (Software Development Kit) that automotive manufacturers can integrate into their in-car entertainment system (infotainment).

The alternative is upgradeable hardware within the vehicle and the car’s infotainment centre almost becoming a serviceable item. This would appear to have potential in the long term but would require a fairly fundamental shift in design in the present as it’s hard to see the average second hand car owner spending large sums of money on new infotainment systems on an asset that depreciates so heavily.

What The Car Means

The final point I shall raise comes from the perspective of someone who has a deep love of cars and therefore could well be highly biased but I believe warrants a mention. For a lot of people (and I’m guessing if you’ve chosen to click on this article you are one) the car is more than just a tool. It is a passion, an interest, a status symbol, a toy, a talking point, a project, something to work for and fundamentally, something more than a machine, it’s something you form an emotional attachment to.

When you make a car into a computer it takes away the mechanical element that gives the car foibles and in doing so you remove its personality, the thing that makes it transcend being a mode of transport. In making cars into nothing more than a pod that you travel around in and potentially don’t even own the element that makes the car more than just a tool could well be lost.

I like to think there is another way though. In the documentary “Love the Beast” Eric Banner talks about how his fame and fortune as a movie star has allowed him to take his ancient Ford Falcon on an incredible journey, endlessly updating it with modern parts. Perhaps the future of the automobile is one where, thanks to 3d printing and the simplicity of electric vehicles, a car becomes a project that can constantly be built upon in the same way old houses can be modernised.

 

B60 were the first mobility consultancy in Europe; Connected Cars and Mobility within the Automotive/Engineering Industries is a rapidly changing environment, if you need help to align your strategy speak to the expert now.

Discover More About Our  IoT Consultancy

Future of Autonomous Cars

Topics: Disruption and Change, Connected Cars, IoT