Electrification, Autonomous Drive Are 2 Of 4 Major Factors Pushing Automotive Disruption

Tesla Model S refresh


Roland Berger released a new report entitled “Automotive Disruption Radar“, identifying four major trends in the automotive industry – electrification, autonomous driving, digitalization and mobility services.

Those trends are leading to the transformation of the industry, which of course brings a lot of new opportunities. As a result, there will be a lot of new players, as well as many spectacular failures, especially for those that try to jump on the train to late (or too early).

Roland Berger said that the automotive industry, and its supply chain face, the greatest disruption in their history.

Maven to expand L.A. car-sharing and ridesharing services by introducing the Chevrolet Bolt EV to the fleet.

Apparently, interest is especially growing interest in electric vehicles, which is not terrible surprising to readers around here:

“The automotive industry faces a radical transformation: Digitization is already facilitating the availability of mobility services like car sharing and ride sharing and is opening up new sales channels. At the same time, electric drive vehicles are becoming an ever greater presence in the market. And there is no stopping the rapid advance of autonomous driving.

Faced with all of this technological disruption, it is interesting to consider how these new developments are going down with customers. And it seems that if it were up to them, the future would be one of self-driving cars and electric vehicles: As many as 46 percent of consumers worldwide would not buy a car again if they had self-driving taxis, otherwise known as robocabs, at their disposal at lower cost. Moreover, 37 percent of consumers are already considering buying an electric vehicle for their next car.

These are the findings of Roland Berger’s first Automotive Disruption Radar. Designed to help automotive industry players make investment decisions, the Automotive Disruption Radar is a publication for which the consultancy regularly examines the progress and the impact of disruptive trends like new mobility concepts, automated driving, interconnectivity and digital services plus electrification. The analysis captures the status quo and progress of developments in five especially relevant areas: regulation, technology, infrastructure, industry activity and customer interest. The experts from Roland Berger consider developments across 25 indices to produce a detailed analysis of these categories. To assess consumer sentiment, for example, the Radar incorporates the views of more than 10,000 consumers across 10 countries: China, France, Germany, India Japan, the Netherlands, Singapore, South Korea, the UK and the USA.”

Automotive Disruption Radar globally (source: Roland Berger)

Electric cars are most popular in China

Buick Velite 5

Electromobility is another area in which the Automotive Disruption Radar highlights significant regional variation. Customers from China express an overwhelmingly positive attitude toward electric vehicles. 60 percent are considering buying an EV as their next car. In South Korea too (54%) more than half of respondents would consider an electric car. Customers from Europe, Japan, South Korea and the USA view the high prices as the main barrier to the purchase of such a vehicle. “Electric vehicles still account for a rather small portion of the market – but the share of electric models in total production saw a significant increase in 2016,” explains Wolfgang Bernhart. “Advances in battery technology give the vehicles greater range and consequently greater convenience. Added to that, the costs have fallen dramatically: high energy cells for electric vehicles are on course to cost about 120 euros per kilowatt hour by 2020. That is three times lower than what a battery cost when the first models were produced.”

“These developments show that the entire automotive industry is approaching the end of an era. And the new momentum in the market is driven by a change in customer expectations,” says Berret in summary. “So there’s a balancing act to be done here: OEMs and suppliers alike need to respond to the disruption and develop new potential. But they can’t just break away from their existing infrastructure, they need to actively work through the process of transformation. That is the biggest challenge for the market players.

More about U.S.:

Automotive Disruption Radar – U.S. (source: Roland Berger)

The first issue of the report is available here: Automotive Disruption Radar Issue #1

source: Green Car Congress

Category: General

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17 responses to "Electrification, Autonomous Drive Are 2 Of 4 Major Factors Pushing Automotive Disruption"
  1. Warren says:

    He missed the hollowing out of the middle class, and the resulting lack of viable auto financing schemes. Just as renting is replacing buying a home, the auto industry will need to transform into a rent-a-ride model. The hope is that autonomous vehicles will make rides cheap enough to sustain the industry. However, automation is a downward spiral eliminating ever more jobs.

    1. David says:

      Those are very simplistic jobs anyways, most people who drive Uber tend to hate it but do it for very little money. Automation creates brand new jobs for a constantly expanding workforce in IT, Computer Science, Mechanical and Electrical Engineering along with bringing back blue collar jobs for Electricians and Machinists. What this automation revolution will bring are much better quality jobs for University and City college graduates. Every new generation of technology brings in much higher quality of jobs, if you feel that those jobs in driving a bus or driving uber are so wonderful then why don’t you do it for 12$ an hour?

      1. Rightofthepeople says:

        I find your views on “those jobs” to be quite simplistic. Tell the people losing their jobs that thier jobs are simplistic and not to worry. I’m not saying automation is a bad thing or that it isn’t coming, because I believe it is coming and ultimately (for society as a whole) it’s a good thing. But brushing aside the very real, human consequences seems to be short sighted IMO. BTW nearly every Uber driver I have talked to is happy doing what they do and many of them are able to support families on what they make. I realize that isn’t a scientific poll, but then again you didn’t cite one either.

        1. Scott Franco says:

          Humm, Tesla is one of the companies that uses the most automation, I think we would all agree?

          Their current employment level is 30,000 people.

      2. Warren says:

        Ah yes, the “creative destruction” phase of capitalism. Unfortunately, with globalisation, it is unlikely that those great IT jobs will appear in the same country as the job displacements, let alone for the displaced workers.

        1. Ocean Railroader says:

          I really think Techies have no heart or soul when it comes to talking about how AI will take away all the jobs.

          The reality what the Techies need to get though their fat tick skulls is not everyone is good at math.

          And I would not want to live in a world with 30% unemployment with no safety net to keep things from falling apart.

          1. Scott Franco says:

            Actually, unemployment rate does not track upwards with automation. It does, however, track upwards with socialized countries.

            Imagine that.

            1. Pushmi-Pullyu says:

              “Actually, unemployment rate does not track upwards with automation. It does, however, track upwards with socialized countries.”

              What certainly does track upwards with increased automation, at least in the USA, is replacement of well-paying, full-time manufacturing jobs with poor-paying or less-well-paying, part-time service jobs.

              Claiming that automation has no impact on the number of well-paying jobs in the USA, claiming that it’s not part of the general trend of the rich getting richer and the middle class becoming poorer, is ignoring reality pretty firmly.

  2. Priusmaniac says:

    There is a serious difference between going to electric cars and going to autonomous cars. Going to electric cars is a clear advantage both in terms of environment and pleasure of driving. That movement is set to happen sooner or later. Going to autonomous cars is something else. If it is about adding a “super cruise control” extra convenience and safety to the vehicle, yes why not. If it is to replace private property cars, then no that is not going to happen because most people simply love their cars and there is passion and property feeling associated to it. People will always want to own their cars in the vast majority of cases. The other ones is city dwellers and taxis that in most cases will indeed be replaced by autonomous vehicles but even that is not sure because a taxi driver brings extra assets like luggage service to elderly or simply city knowledge or a sense of contact.

    1. Rightofthepeople says:

      I share your views that most still want to own and drive their own car, but then again I’m 44 years old. You may be similar to me in age, maybe not. But I also believe that many young people (like my kids, who are 17 and 15) will embrace a model of transportation as a service over car ownership at a rate far higher than people my age and older. So it will take several generations, but ultimately car ownership will likely dwindle to a very low rate in favor of TaaS thanks to autonomous drive.

      1. vdiv says:

        Dude, you’re old (said a 40 year old 😉

        Let’s not forget that many, many people live outside of big metropolitan areas where vehicle-sharing simply is not available and not practical. Any autonomous improvements there are unlikely to result in greater vehicle sharing.

        1. Ocean Railroader says:

          I don’t like sharing my car with strangers.

          And on top of that do you really want to live with putting up with the car rental mayhem and costs every day of the week?

          I find renting a car or getting a taxi ride annoying. I also don’t want to have a self driving car pull up to my drive way to find out it’s covered in cigarette butts.

    2. GuyMan says:

      I’m also fine with the “EV” part, but I’m also a fan of “autonomous driving”. I’m 54, I don’t “love my car”, I don’t have a passion for driving, I travel alot, internationally, and do 400+ mile domestic drives at least once a month. Climbing into a robo taxi (Uber without the driver), for an 7 hr drive, while I work or sleep in the back, is totally fine with me (actually, something I’m looking forward to – Like a plane, without the hassle of TSA).

      Cars are about transport – getting from point A to point B, and given the state of mass transit in the US, they are pretty much you only choice for anything under 500 miles. Doing that in the cheapest, most efficient manner, is what it’s all about.

      FYI, the bullet trains of Japan are my favorite means of travel, but they (Japan) have a great advantage in population density over the US, so I’m OK with cars, and they definitely beat buses in the US – I just don’t want to have to be awake/alert, and burn 7+ hours of valuable time, driving every month.

      My kids care about cars even less than I do. – Their phone is a “status symbol”, not a car. A car, with the cost and downtime of maintenance and repairs (let alone buying gas), is a necessary evil to them.

      So yea, when (not if), L5 autonomy is real (and I don’t believe that will happen in 3 years, more like 10, IMHO, but it WILL happen, and likely in my lifetime), private car ownership will drop at least 50% in the US, given access “robo-cabs”, and this is said as someone that owns 3 cars for a 4 person family (two teenagers, and two working adults). It’s not about renting out my car, it’s about not owning one (or two), and just pushing a button on my phone, and a “robo-cab” shows up in 2 or 3 mins. Basically, Uber without the driver – No insurance, no maintenance, just transport as a service (like planes, trains, etc – Just without other people).

      1. Chris says:

        I travel a lot also all over the planet. I first went to China in 1980 and the change from then to now is astounding and to think it happened between the time I was 21 and 59. I watched the Chinese go from bikes to scoters and now to cars. Owning a personal mode of transport seems to be a human need.

        Probably one of the reasons the Chinese say they will consider an electric car is two fold. The licensing fee for an electric is $0. In Shanghai my coworker told me last week it is currently nearly $10,000 USD. But I would argue that last thing most Chinese cities need is another car on the road. Also electric scooters are very common in China and have been for a while so electric mobility is nothing new to the Chinese. Will robo cabs take over there? Hard to say I think they need to get driving out of there system and they have 1.4 Billion people to employ so probably not as quickly as other places.

    3. Pushmi-Pullyu says:

      Priusmaniac said:

      “If it is to replace private property cars, then no that is not going to happen because most people simply love their cars and there is passion and property feeling associated to it. People will always want to own their cars in the vast majority of cases.”

      Well said. Nothing has surprised me more, in comments posted to InsideEVs, than the number of people who go along with this notion of large numbers of people voluntarily giving up owning their own car.

      Essentially, that would be the same as someone deciding to sell their car and depend only on taxi service for the rest of their life. Really? Those areas where that would be possible are already served well by taxi services.

      Replacing human taxi drivers with robot taxi drivers isn’t suddenly going to create vast fleets of taxis where the population density is too low to support them!

      Do a lot of teens and young adults today say they are going to rely on ride-sharing or services like Lyft, over owning their own car? Well of course they do! What choice do they have? With the economic downturn in the middle class, far fewer kids today — or their parents — can afford to buy a car and keep it insured and maintained.

      That’s not a preference, it’s not a choice; it’s an economic necessity caused by the declining average level of wealth. (“Average” in this case is the mode, not the mean. Total wealth has not declined; it’s that a much greater portion of total wealth is now concentrated in the hands of significantly fewer people than it was 30-35 years ago.)

      1. Pushmi-Pullyu says:

        Clarification: I meant: …far fewer kids today — or their parents — can afford to buy a car and keep it insured and maintained for those kids.

        When I was going to high school, very few kids had their own cars. Those who did, mostly had summer jobs to pay for them. As I got older, I noticed a trend of parents buying cars for their kids, or giving the kids their old cars when they bought new(er) ones. Certainly not all of them, but it became common.

        That latter trend seems to be declining, as the middle class grows poorer. We’ll be back to the way things were when I was in high school, with very few kids having their own car. And not by choice, but because neither they nor their families can afford it.