Accordingly, commuting miles will decrease and the role of the car, which used to be primarily for work commutes, will shift to being used for the weekends, evening trips and shorter drives. The wave of technology that is upending the staid automotive industry also implies a shift in the balance between hardware and software. And the automotive industry is no exception from these changes and developments. As a result, suppliers of automotive software solutions are becoming more prominent in the automotive supply chain. In 2030, the share of electrified vehicles could range from 10 percent to 50 percent of new-vehicle sales, according to Mckinsey. As downstream functions in the car also experience rapid digital transformation, OEMs will need to redesign their digital retailing strategy. The Automotive 2030 Executive Survey conducted by IBM reveals that for automotive businesses to differentiate their brands, After a peak of 4.1 million off-lease vehicles came back to the market in 2019, Cox Automotive Chief Economist Jonathan Smoke is forecasting that inventory levels in 2020, in … They were very professional and very customer oriented. update Article was updated Jan. … Enabling technologies will convert cars into marketplaces, allowing consumers to do literally everything—refueling, purchasing services, paying for tolls, getting Features on Demand (FoD), and much more—from the comfort and convenience of their car. The 2020 Global Automotive Consumer Study provides insights into how consumer opinion about these disruptive technologies may affect the future of the automotive industry and where automakers are investing to bring these advanced features to market. From the economic depths experienced in spring 2020, it has rebounded to deliver year-over-year growth in new … Continuing Growth of Electrification. I am a Managing Partner in Frost & Sullivan, Regional Leader of its Middle East, Africa and South Asia (MEASA) operations and the company’s Global Practice Head of Mobili. This is one of the latest technologies in the automotive industry. Car As A Marketplace: in the future, everything related to on route mobility services will be available through a car. I, for one, am looking forward to driving back on a cold winter’s night, while being able to set the temperature at home to a balmy 27C. As a result, car companies are working on what we call “customer transformation”, in essence, creating personalized and customized digital solutions across the customers’ lifecycle management of the vehicle. All these trends are likely to become increasingly apparent between 2020 and 2025 – which means that these are decisive years for manufacturers and their suppliers. ELEKS has been involved in the development of a number of our consumer-facing websites and mobile applications that allow our customers to easily track their shipments, get the information they need as well as stay in touch with us. Another consequence of lower commuting miles will be felt in lower aftermarket sales. By when, according to McKinsey, 50% of new cars will be electrified vehicles. As car companies revisit their value chains, they will evaluate reused and shared parts for new product development. My team and I pioneered the “Macro to Micro” approach in analyzing Mega Trends in 2008, which has since been tried and tested with Fortune 1000 companies in developing white space opportunities. The real challenge now will be not to build more models but to drive greater personalization. © 2020 Forbes Media LLC. However, it has provided automakers with an unexpected opportunity to introspect and home in on the most impactful ideas and trends that will shape their future in the decade ahead. Melysa Chong. Sales of new and used cars as well as of vehicle related services will become platform / digital based. The global automotive industry recovery in 2020 largely depends upon a recovery in the Chinese economy. The automotive industry was impacted with the closure of multiple production hubs due to COVID-19. In fact, it is one of the sectors changed to its core. Auto manufacturers continue their push toward the aggressive … Electrified. For more details on these emerging automotive industry trends… 2020 will be a big year for the auto … Brandwatch data reveals some of the biggest consumer trends for the auto industry as we head into 2020. How 2020 Trends and Insights are Reshaping the Automotive Industry. Car allowances might be (pay) cut by corporates, causing the lucrative corporate fleet market, especially the premium segment, to suffer. U.S. auto industry trends aren’t very positive these days with auto dealers watching forces beyond their control put a damper on dealership sales and profits. Hertz’s collapse is symptomatic of the market’s decline. Yet the emergence of Tesla as a car brand points to a future roster of novel brands, brands that take advantage of automotive industry disruption such as electrification. I have also done an executive course at the Kellogg School of Management. Automakers are now contemplating two divergent approaches: first, the Tesla strategy which aims to combine camera-based technologies to push onto Level 5 and, second, the proceed-with-caution strategy which seeks to persist with Level 2.5 for a period of time before ramping up to Level 4. Future Of Work: In the workplace, we will see a transition from working in office to working from your castle, i.e., home. Another example relates to the need for dedicated platform and vehicle architecture to manufacture EVs. Added to that is the fact that most western countries have reached peak car already. Two Speed World Economy: Globally, auto sales will recover much faster in China and the U.S. than the EU and India. In the past few months, my team and I started from scratch, tracking and dissecting the effects of the pandemic on the mobility industry. By and large, these changes will be huge improvements for drivers, … Follow me on Twitter: @Sarwant. With national lockdowns and less travel, personal vehicles sales are dwindling. ), while auction prices for used cars are on the up and up. We might also see car companies cut back and consolidate the number of trims, variants and powertrains. Over the last few months, the auto industry has shown tremendous resilience. Keep reading to find out. Accepted file types: jpg, gif, png, pdf, doc, docx, xls, xlsx, ppt, pptx, png. The world is gradually … This makes predicting the rest of 2020 a difficult challenge, but … CL. New hotspots of growth might emerge in Russia and Eastern Europe. For instance, car companies will also become charging point utilities, much like what VW has done. ELEKS has been involved in the development of a number of our consumer-facing websites and mobile applications. ), here is our pick of the top 20 trends that we believe will shape the future of the auto manufacturing industry in a Covid-defined 2020 and beyond. Brand-new auto brands are a rare occurrence and are usually backed by established manufacturers. If anything, the Covid crisis has completely overturned every prediction and projection made at the beginning of 2020. In their pursuit of value creation, retention and enhancement, automakers will push forward on connectivity platforms, personalized offerings and FoD services. The broader influence of automotive technology will continue to drive disruption in 2020 as the established automotive industry increasingly converges with contemporary technology. Autonomous cars are becoming a reality, with IBM predicting that 15% of new cars will be self-driving as soon as 2030. The National Automobile Dealers Association highlighted in its 2018 review that new-vehicle sales breached $1 trillion. Source: Automotive 2030 Executive Survey by IBM, Data-Driven Digital Transformation of a Car Rental Business, We need your name to know how to address you, We need your email to respond to your request, We need your phone number to reach you with response to your request, We need your country of business to know from what office to contact you, We need your company name to know your background and how we can use our experience to help you, We will add your info to our CRM for contacting you regarding your request. I consult Fortune 1000 companies (clients like P&G, Ford, Philips, BMW, Fiat group, Nissan, Toyota and UNIDO). The popularity of ride-hailing and other types of shared mobility (including car-pooling apps like BlaBlaCar) is set to increase in the 2020s as technology continues to support these trends while consumers seek ways to save money. But is it all doom and gloom? Doing so will include partnering with vendors previously outside the auto industry and may mean more extensive use of platforming to cater to diverging global consumer needs and requirements. The organization’s 2018 report says that the automakers in the country have exported vehicles and parts worth over $692 billion over the past five years. How Predicting The Future Has Changed For Automotive In 2020 Shakeup Of The Fleet Market: Typically, fleet markets have always made gains during a period of recession. The rise of transportation options and diminishing interest in car culture … Other factors include changes in global supply chains, shorter technology cycles and of course pressure from environmental regulations. You may delete and block all cookies from this site. EY & Citi On The Importance Of Resilience And Innovation, How Digital Workflows Helped Save Basketball During The Pandemic, Impact 50: Investors Seeking Profit — And Pushing For Change, Michigan Economic Development Corporation With Forbes Insights. Looking ahead to auto industry trends in 2020. Furthermore, technology has changed the competitive map: with tech-first car manufacturers now disrupting a market previously dominated by established brands. Supply chain diversification will open up opportunities for countries like India and Mexico. Circular economy practices anchor Vision Zero. Online To Boom: We are already in the midst of a paradigm shift from offline to online. Automakers will perforce create differentiated Gen Z focused strategies, while special models underpinned by connectivity technologies —I think the Chinese will steal the thunder here, again—will be designed to appeal to Gen Z customer preferences. Cars, driving and mobility in the broad are changing at an incredible pace. Opinions expressed by Forbes Contributors are their own. This field is for validation purposes and should be left unchanged. This will be a key way of achieving differentiation in the future. Industry Top Trends 2020: Autos We expect no revenue growth for the industry in 2020 and 2021. If SUVs and cross overs were the dominant body styles of the last decade, the next decade could see the emergence of new body styles driven either by Covid, the shift to a second type of car or the debut of a new generation of boxy, monolithic models for the growing Gen Z customer segment. Luxury To Manifest In “Digital” Vehicle Functions: We expect luxury vehicle sales to decline by 30-35% over the short-term before gradually picking up over the medium- to long-term. A glimmer of hope will come in the form of growth in private leases. The Internet of Things (IoT) has led to a wave of connectivity … After much heated discussion (that’s one thing that’s remained unchanged, pandemic or not! Here are Scott’s predictions for automotive industry trends 2020: (Walmart's) total marketplace sales for #autoparts and accessories including #Amazon and #eBay will overtake that of … We are able to forecast the trends owing to our expertise in research, survey, and industry experience. Indeed, shared mobility is changing the expectations of car ownership – and the purpose of an automobile. Growth In Share Of Wallet Across Product Lifecycle: Car companies now focus not just on selling hardware, i.e., the metal, but equally on generating continuous revenues across the lifecycle of the vehicle. Our latest research shows that consumer interest in cars is as strong as ever. Adapting to today’s automotive industry challenges implies several technology trends that affect how the car industry goes about its day to day business in the next decade, modifying the way consumers use and experience autos. Data As The 21st Century Oil, The Shift From “Horsepower” To “Computing Power”: Data-as-a-service is set to grow post Covid. Gen Z As Car Buyers: A big one for car companies will be the coming of age of Gen Z customers. Rise Of Lean Product Development Strategy, Diversification Of Supply Chains: The Covid crisis has highlighted the overdependence of the auto industry on Chinese suppliers for parts, especially in the electric vehicle (EV) market. The breadth of knowledge and understanding that ELEKS has within its walls allows us to leverage that expertise to make superior deliverables for our customers. Top 20 automotive trends for 2020 and beyond. Electric Vehicles Are a Big Deal In the 2020 Global Automotive Consumer Study published by Deloitte, EV technology takes the focus. But while the global auto sales industry … More than 50 presentations and keynotes were held, and nearly all presenters and speakers mentioned how they are changing their production and marketing strategies through digitalization and the latest user feedback. Growth In Subscription Services: I’ve always been bullish about subscription services and continue to be upbeat as they spread rapidly to developing automotive markets. As in all industries, digital transformation trend in automotive are shaking things up moving into 2020 and beyond. Initiatives here will increasingly involve licensing models or collaborative endeavors like GM’s with Cruise and Honda. Rebirth Of The Used Car Market: In an environment where value is paramount, the used car market will make a strong comeback. There’s also the eternal development vs deployment debate. Kimberly Matenchuk, Senior Director of Sales at GE Digital, United Kingdom, says that innovation is dependent on the needs. Toyota on Tuesday reported a 23% drop in U.S. new vehicle sales in August versus the same month in 2019, as a two-month industry-wide shutdown of auto production in the spring to halt … In fact, 80% of surveyed executives expect customer experiences to be greatly enhanced by digital services. Your email address will not be published. So far, Frost & Sullivan has already identified six such platforms with used car sales likely to migrate wholly online over the next 3-5 years. Return Of The Hatchback And New Body Styles: We might see the return of the hatchback, exemplified by the VW Golf, as a second car. I think, without ELEKS it probably would not have been possible to have such a successful product in such a short period of time. Instead, autos will be integrated into a tech-reliant society, with 16 million 5G-enabled vehicles sold, every year, by the end of the next decade. We think these are five key trends to keep an eye on in 2020: The internal combustion engine has been the building block of the auto industry for over a century, but environmental regulation and consumer concerns is driving a shift to hybrid and battery-powered cars. Cars will cease to be discrete tools that get passengers from A to B. According to the American Automotive Policy Council, the automotive industry is the largest manufacturing sector in the United States. We’ve appreciated the level of ELEKS’ expertise, responsiveness and attention to details. Connectivity. People Love Cars Again. technology innovation continues to be of top importance. 5G enabled vehicles sales are expected to reach 16 million in the EU, US and China by 2030, according to PwC. Connected Car IoT Platforms: Much like mobile phones, we will see operating systems becoming standard for cars. Auto industry trends – and especially auto industry sales trends – have been thrown into disarray by broader societal factors. From insurance to manufacturing all industries connected to automotive have evolved enormously in the past several years. I am an Engineer and have a MBA from Leeds University Business School, for whom I am now a member of their Advisory Board. Required fields are marked *. IoT and 5G drive pervasive connectivity, boosting a steady march to autonomous driving, with advanced driver-assistance systems (ADAS) already a common in-car feature. Covid might have thrown the automotive industry (not to mention, our annual forecasts) off track. In contrast, the continued focus of German and Japanese automakers on horsepower could soon end up becoming misaligned with the new digital architecture requirements of vehicles. Such trends will again challenge car companies who depend heavily on high mileage driven by the workplace commute. They came to us with their best people to try to understand our context, our business idea, and developed the first prototype with us. Cars As An Element Of Connected Living Solutions: Cars will become an integral part of connected living solutions. 15% of new cars sold could be fully autonomous by 2030, according to IBM. Usage Based Insurance for Vehicles. 2020 Consumer Trends for the Automotive Industry 1. Software and dataare becoming essential to develop both local and global strategies. We have already entered 2020 and we are done with our homework to unlock various secrets of consumer trends for automotive industry. Get in touch to see how we can help your company to not just adapt to a rapidly changing automotive industry, but to thrive in a changing motoring environment – pivoting off technological change to outpace competitors. Circular Economy, Automotive Industry Innovates to Zero: Covid will provide impetus to automakers’ Vision Zero initiatives. When you work with ELEKS, you are working with the top 1% of the aptitude and engineering excellence of the whole country. Valuations of used car companies are at an all-time high (pick up some Vroom stock right away! (jpg, gif, png, pdf, doc, docx, xls, xlsx, ppt, pptx, PNG). And it’s not just in-car technology that is imposing change, the mobility revolution plus tech trends including AI and machine learning has meant that cars are used differently. Meanwhile, Brexit and other protectionist economic policies will favor onshoring rather than offshoring in the future. Digital disruption is transforming the automotive industry. I expect over 100 connected car features to be available to consumers across emerging and developed markets by 2025, from current figures of less than 40 in most high-end vehicles. I am also the founder of a think tank group that works on future (Mega) trends. I authored “New Mega Trends,” published in 2012 with Palgrave Macmillan, which has since been sold in over 30 countries and is currently being translated into Chinese for a China market release in 2014. After 21 months of continuous decline, the Chinese car industry actually grew in April and May. … While hardware used to dominate automotive technology there is a clear transfer in that the use of cars is increasingly underpinned by novel software solutions. I foresee two major shifts here: one, from the premium segment to more volume segment offerings and, two, from being primarily city-based models to becoming more pan-country based models. The good news is that new digital IoT solutions can enable just that. Shared mobility. The major value creator will be the customer experience and digital initiatives, which will help automotive businesses to boots their brand value. 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