MUNICH -- BMW sales and marketing chief Ian Robertson warned that the marketplace for transportation is evolving at a far faster pace than only recently believed by the car industry, likening incumbent automakers to frogs in a pot slowly cooking to a boil.
“In our view the next 10 years are probably going to involve more change and more dynamics than we have seen in the last 100,” he told participants at Automotive News Europe’s annual congress here today. “The challenge for us as an industry is: Don’t enjoy the warm water, because it’s not going to end well.”
In particular, people’s reliance on smartphones to shop for clothes, buy food or book holidays with the ease of a click has affected every sector of the economy, pressuring brick-and-mortar retail everywhere. In the future, intelligent devices will form the center point for access to personal mobility, Robertson said.
“In 2003, there were 6.3 billion people and 500 million smartphones,” he said. “What you see now is that very, very shortly we are now going to have four or five devices for every person on the planet -- now that tells you something changed and changed very quickly.”
The shift to connected cars, electric propulsion and a sharing economy has broken down the traditional barriers to entry that have protected the auto industry for decades. This is encouraging entrepreneurs and venture capitalists to challenge the status quo.
“If you go to Silicon Valley, and I was there a couple of weeks ago, 50 percent of all the startups last year had some sort of mobility in their title -- 50 percent. Many of them will crash and burn but a few will come out the other side,” Robertson said.
Ride-hailing company Uber, the world’s most valuable startup worth an estimated $63 billion, demonstrated what can happen when incumbent players watch a newcomer revolutionize a marketplace they have long controlled.
Robertson said the taxi industry in the world is no longer and never will be again like it was one year ago, two years ago, or before Uber. “That business model is broken despite the fact that those of you who came by plane saw 50 taxis lined up outside Munich airport this morning. They are hoping it goes away, and it won’t.”