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Convergence in the automobile sector

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Convergence

  • Due to rapid geopolitical and technological change in the market, companies have found themselves having to cooperate with companies from different sectors so that they may successfully develop new products and services , to broaden their value chain
  • This article explains why convergence is growing significantly in the automobile industry and further explains the following five theories that support this growth in convergence:
    • The dominant position of automakers and automotive suppliers will be threatened in the future by new market participants from outside the industry
    • Rising customer expectations of new technology are putting pressure on manufacturers to keep coming up with affordable innovations. Convergence models offer a platform for innovation management as well as cost advantages
    • The mounting scarcity of resources and enduring climate discussion urgently necessitates interdisciplinary approaches. Automakers have to enter convergence relationships today in order to have solutions for tomorrow
    • The automobile sector’s advanced degree of maturity has a decisive influence on the future alignment of manufacturers and suppliers. In this context, convergence represents the key to innovative and profitable business models
    • Changing demographics and continuing urbanisation are altering our mobility needs. Convergence can help in the development of new and innovative products and services, and thus with fulfilling the consistently high expectations made of automobiles
  • Deloitte can help clients to turn ideas into strategies and also show them how to utilise convergence to make their company more successful in their core areas of business
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