How Connected Cars will Change the Car Industry
As we reported last week, the increase in demand for connected vehicles is likely to bring radical changes to the automotive industry. This is a huge opportunity for car makers but there are several issues in the traditional automotive industry that will need to be addressed as connected cars become reality on our roads. Here are some of the challenges that are likely to be faced in the coming years:
- Cars take longer to develop than smart phones so the difference in lifecycles will have an impact on factors such as the operating system, new applications and upgrades. These are all provided constantly for smartphones but car manufacturers currently work on five year cycles – this is an issue that will need to be addressed in order for connected cars to be brought to market on a widespread basis.
- Connectivity will be dictated by new safety laws. By 2015, all cars in Europe must be equipped with eCall, a system that automatically alerts emergency services in the event of a collision. Similar safety systems will come into effect in other countries as connected cars are adopted globally.
- Auto makers will need mobile partners to satisfy customer connectivity requirements – this means collaboration between the mobile and automotive industries. We’re likely to see a scramble in the coming years as the big automobile makers choose which mobile provider to use as its partner.
- Car dealers will need to be tech-savvy and salespeople will need to spend time teaching customers how to use their new car’s advanced technology. This is likely to impact radically on the current car dealership model and car salespeople will need the requisite training in order to function effectively in this new market. Sales training will need to be combined with training in technology and effective communication (in order to “teach” the customers how to get the most out of their vehicles).
- Connected cars are more likely to be shared cars which will create new opportunities for new ownership models such as car sharing services.
- How to connect to the web – both car makers and mobile operators are currently debating whether built-in or brought-in connections. While built-in options result in stronger connections, many consumers would prefer to tether their smartphones to the car via Bluetooth or USB cable in order to enjoy full access to playlists and contacts.
- Pay as you Drive? Buying a car is traditionally a one-off purchase but connected cars will result in additional ongoing payments for connectivity. It’s unsure at present whether the added costs will be included into the price of the car or whether the car will be added to an existing mobile bill as a “device”.
- Security is a very real issue when it comes to connected cars which means that the apps on offer are likely to be limited.
- The automobile industry knows that they must introduce connected cars if they want to stay in the game. Customers expect continuous connectivity these days – it will improve customer service and help car makers to maintain brand awareness in the future.