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General Election 2019: This time it’s personal

Getting under the bonnet of vehicle connectivity

Words by:
Senior Account Manager
January 21, 2019

The car has evolved significantly over the last century. The driving experience, however, has largely remained the same. But this is changing. Most headlines to date have focused on driverless cars in the context of future mobility. Unsurprising really, but more interesting is not who might be driving cars in the future, but what’s currently happening under our bonnets.

Nowadays, being disconnected from the world is alien to most of us because we now see connectivity as a need rather than a luxury. Vehicle connectivity is central to this behavioural shift and already driving a huge number of innovations that will transform all our travel experiences.

It’s not about getting from A to B anymore but doing so in a way that facilitates our accessing a host of new experiences and connectivity features within our cars. In-car safety (e.g. integrated cameras, self-braking), vehicle to vehicle safety that allows cars to effectively talk to one another helping to prevent accidents, data tracking to record vehicle usage, infotainment that connects us to things like Spotify and, of course, 4G WIFI hotspots, are all in high consumer demand.

Interest from original equipment manufacturers (OEMs), government and third-parties will also increase this year. Eager to harness its potential whilst also overcoming its many challenges, questions remain as to whether existing car manufacturers will be able to keep hold of their vehicles’ data. It’s likely irresistible pressure to provide access to third parties, both to create new types of services but new revenue streams too, will soon prevail.

The amount of data a vehicle generates is set to explode but monetising this huge increase in operational data is easier said than done for OEMs who have historically fallen behind market disruptors. There are also questions about whether consumers want to see an increase in vehicle connectivity. Though considered highly beneficial in countries like China, it isn’t in countries like Germany, for example. Consumers’ willingness to pay for connected data services will surely also come into question as let’s face it, we’ve all come to expect basic services and apps for free.

OEMs’ potential to realise benefits from being in control of a vehicle’s data is enormous. This can range from knowing which parts of a vehicle are likely to fail and when, real-time data that’s sent from vehicle sensors to identify problems early or knowing a customer’s driving behaviour that helps design better, more customized customer experiences, ultimately improving brand affinity and loyalty.

However, not every automaker is well positioned to succeed at every stage of the connected vehicle value chain. As a result, though in possession of a vehicle’s data, they are reluctant to give this up as, understandably, want to control every point in the value chain. For years, many OEMs have attempted to build the entire mobility data ecosystem themselves, but only by partnering with outside organisations can the monetisation of vehicle data develop to its full potential.

Many OEMs have also failed to hide their collective vulnerability to market disruptors looking for ways to bypass them. For instance, for user-based insurance, the addition of a simple plug-in allows insurance companies to gain access to vehicle usage data which means being able to avoid the need to interface with OEMs.

There’s also a question of data protection. Generally, consumers are more willing to share their data for services or features that have a perceived benefit, but trust would be lost if the data OEMs share is compromised in any way. Keeping this trust and brand loyalty whilst also trying to use customers’ data to create better and more personalised experiences for them will be a huge challenge.

Similarly, who owns a vehicle’s data and who gets to use it will also be key questions that need answering before vehicle connectivity really takes off. The most interesting data sets are often the ones that are shared across connected ecosystems that include consumers, OEMs, and service providers. However, studies have shown consumers aren’t fully comfortable with one type of company managing their connected data. Naturally, this will help make the case for why OEMs should give up their total control over their vehicles’ data as they simply aren’t best placed to make the most of it.

Vehicle connectivity is the future and OEMs will need to capitalise on the opportunities it brings, not only for them, but for society as whole quickly. If they don’t then they risk losing out to more agile and non-traditional competitors.

And so, what’s happening under our bonnets now and in the future will create far more disruptive changes to the automotive industry and how we travel in the short-to-medium term, than any increase in cars’ ability to drive themselves.

 

 

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