Connected Vehicles Enter the Mainstream
Trends and strategic implications for the automotive industry
Over the last quarter century the world has witnessed the steady emergence of mobile communication technologies that continue to redefine how people connect with each other. Today, the virtual networks that connect consumers, businesses, friends, families and everyone in between are alive 24 hours a day, seven days a week as people seek immediate access to information.
The emergence of mobile communication technologies has now spilled over into the automotive industry, resulting in a dramatic impact on not only vehicle connectivity, but also on how consumers view transportation as a means of staying connected. Connectedness is also in its infancy and, as a result, consumer desires are still being defined.
A survey of 1,000 consumers conducted by Deloitte shows that more than a third (37 percent) want to stay as connected as possible while in their vehicles. Forty-four percent of those aged 18 to 24 responding to Deloitte’s survey rated connectivity as being extremely important.
According to a recent Deloitte survey
- 84 percent indicated emailing or texting in the vehicle and 24 percent indicated the use of smartphone apps are the features they are expecting to see as part of in-vehicle connectivity.
- 37 percent indicated they would like to stay as connected as possible while in the vehicle, and many ranked streaming entertainment content as most desirable.
- 65 percent identified remote vehicle control as important to their next purchase.
- 77 percent favored remote diagnostics that minimizes dealer visits.
The implications for most automakers and their business collaborators in response to these trends are significant and result in a number of new challenges. At the same time, 24x7 demand for information also creates new opportunities for vehicles to take their rightful place as a connected node on the mobile communications highway — a node that not only delivers the connectivity consumers demand, but can also create new pathways of V2X (vehicle-to-vehicle, vehicle-to-infrastructure, etc.) connectivity that can improve driver safety, improve vehicle performance and durability, and enhance the overall driving and vehicle ownership experience.
Today’s brave new world
Advancements in wireless connectivity have delivered easy and affordable access to Internet-based services such as cloud-based music, social networking and online shopping to the palms of consumers’ hands. As a result, many consumers are taking their technology, personalization and ownership cues from experiences outside of the vehicle, yet expect those same experiences to be available in the cars and trucks they drive. Consumers are also beginning to consider in-vehicle technology to be more important to brand in determining loyalty, and are increasingly expecting to receive in-vehicle technology training during sales delivery at the dealership.
This latest phase in connected vehicle services and the need to meet consumer demand has created some interesting questions for the various stakeholders in the vehicle connectivity value chain, including:
- Are automakers responsible for preselecting Internet-based content that is made available in the vehicle, or can automakers simply provide the platform and allow consumers to customize content as desired?
- How can communications and technology companies work with automakers to balance connectivity and concerns with distracted driving?
- How can these stakeholders collaborate to improve the pace at which new mobile technologies become available in the vehicle?
- How can automakers take steps to determine that a vehicle’s on-board technology systems remain compatible with new technologies that emerge over the life of the vehicle?
- How can automakers leverage infrastructure supporting vehicle connectivity to create new innovations that improve driver safety, extend the life of the vehicle through services such as on-board diagnostics, and reduce the vehicle’s impact on the environment?
- How do automakers and their collaborators balance fees for services with consumer expectations?
This report discusses these questions and outlines growing trends in the connected-vehicle industry, including strategic implications automakers should consider when evaluating various connected vehicles business models.
As used in this document, 'Deloitte' means Deloitte LLP. Please see www.deloitte.com/about for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting.