The automotive industry is undergoing huge digital transformation, driven by key trends such as connectivity and electrification. Having scalable and open technology platforms is more important than ever as cars continue to shift from driving machines to intelligent, digital and connected experiences on wheels.
Underpinned by 5G and digital transformation, automakers have an opportunity to create unique and personalized customer experiences by harnessing the power of emerging technologies.
Customers expect a smartphone-like experience, where the car is actively providing digital services -- whether through real-time navigation, intelligent infotainment, voice commands and AI assistants or informational safety.
Embedded connectivity is expected to represent 30 percent of a vehicle's makeup by 2030, while 50 percent of auto industry revenues in the same year will come from disruptive technology -- highlighting the need for a forward-thinking, “always-on” digital approach from manufacturers to meet this demand.
It is therefore important for automakers themselves to grow digital, service-based offerings for customers, which provide significant opportunities for new and expanded revenue streams.
None of this is possible without connectivity. As 5G becomes more widespread across Europe, the automotive ecosystem will find itself with ever more possibilities to drive new revenues by offering brand new services and user experiences.
In simple terms, 5G means faster downloads, lower latency, and more consistent connectivity and quality of service.
When combined, these factors all unlock the potential for richer, safer, more autonomous, more immersive experiences in cars for drivers and passengers alike -- all of which enable attractive and exciting new services for customers, and major new revenue streams for the entire industry.
For example, road safety services will allow cars to communicate with each other to reduce or eliminate accidents and big data analytics will allow for services that will harmonize traffic speeds in cities.
We know that models of car ownership are shifting in line with the industry's direction of travel toward electrification. By 2027, analysts predict nearly 75 percent of all vehicles sold will come with embedded connectivity, so automakers are increasingly looking at these connected experiences to differentiate their offerings, grow market share and strengthen or reinforce their respective brands.
Electric vehicles result in a new chassis, and automakers are embedding their vehicles with connectivity to create a Digital Chassis.
This new level of digital architecture offers automakers exciting, new opportunities to differentiate and upgrade their vehicles to meet consumer demands for increasingly autonomous, connected, safe and smart driving experiences.
Perhaps the biggest shift for the automotive industry is still to come: the shift to autonomy. Assisted driving should be built for every car today. This includes features such as highway autopilot and the ability for Level 3 advanced driver assistance systems (ADAS).
Many automakers have made strong progress already and are well on the way in their journeys by developing and enabling ADAS features. This is exciting progress which is already making journeys on our roads safer today.
These trends will undoubtedly be ever-present across the industry over the coming months and years, certainly based on manufacturers' showings at events such as the auto show in Munich last September, CES in Las Vegas and more recently Mobile World Congress in Barcelona.
These events are opportunities for automakers to demonstrate their cutting-edge technologies and customer offerings, highlight new in-car experiences and position themselves as leaders in digital and infotainment services.
We should expect plenty more of these events to be centered around the technology and connected capabilities for the customer throughout 2022 and beyond.
Taking the above into account, what we are seeing across the industry, whether it is automotive trade shows, tech events and connectivity forums, is that the technological capabilities and interior of the vehicle have become far more important to the customer when purchasing a new vehicle.
In the future, automakers will continue to prioritize in-car digital experiences and leverage next-generation technologies to differentiate their offering from a competitor's. Digital capabilities and connectivity are becoming dominant forces across the auto industry, and will continue to grow and emerge in years to come.
