MUNICH -- Seat's home city of Barcelona will play a key role in the Volkswagen Group brand's strategy of offering easy and affordable connectivity to its young customer base, CEO Luca de Meo said.
Seat was a forerunner in offering Apple CarPlay and Android Auto smart phone connectivity through its Full Link infotainment system. The brand has partnered with Samsung and SAP to develop further features such as an app that lets drivers reserve and pay for a parking spot without leaving the car.
De Meo believes Seat's location next to Barcelona gives the company an important edge over rivals. The Catalan capital has developed in the last 10 years into one of the most dynamic new economy hubs in Europe, capable of attracting promising startups and very sharp-minded entrepreneurs, de Meo told the Automotive News Europe Congress here last week.
Barcelona has two of the world's best business schools, ten of Europe's top leading startup accelerators and the city hosts one of the tech industry’s most important annual fairs, the Mobile World Congress. These help to make the city the “perfect playground to test the connected car and the ecosystem around it,” de Meo said.
De Meo believes the possible revenue opportunities to be made from connecting drivers with their surroundings was the core reason that tempted tech juggernauts Google and Apple to invest billions of dollars into developing of automotive-related technology such as the self-driving car. “They recognize an automobile is not the last vestige of the old economy, as some tried to convince us a couple of years ago, but that cars will be a big and important part of Internet of Things,” he said.
To avoid end up being exchangeable suppliers to the tech companies, the auto industry needs to attract and keep customers logged into their own ecosystem of mobility and services built around their core product. “By creating the shell around, we are going to protect the hardware - we will protect the car and the brands,” he said.
Connectivity will play a bigger role for Seat than other megatrends such as electric cars and autonomous driving because these were beyond the reach of the brand's target customers, who are young and price-sensitive, de Meo said, or they represented too much of a compromise.
“If we can connect the car to the user to the retailer to the infrastructure - all of them together - then I really see a business opportunity. How much and who will take advantage of it is extremely open,” de Meo said. “That’s why the connected car out of the three is a priority for Seat.”
De Meo said Seat is compelled to develop an electric car to meet future CO2 targets despite the high costs being a burden on the brand which only recently returned to profit after years of losses. Fortunately, the brand doesn’t need to invest heavily in the expensive technology since it can borrow it from its VW Group parent.
Specifically speaking about whether Seat was planning to launch an electric car, de Meo said: “Of course we will, and probably sooner rather than later forced by upcoming CO2 regulation.”