At one of our most recent meetings, I asked this distinguished technology leader from a market leading manufacturer what he thought is the most prominent global megatrend that the Indian industry is warming up to. And what he thought would be more prominently pursued than the others?
With the Indian government pursuing the electrification agenda with great vigour, many organisations in the industry are redrawing their future strategies, or at least are exploring opportunities to play in the EV space. While it would still take some time for the sector to figure out opportunities and possibilities in electrification, connected technologies are making strong inroads into manufacturers’ product plans. This isn’t new, but the aspect of connectivity is opening up new vistas for the sector every passing day.
The automotive world is fast drifting away from the traditional model of manufacturing and ownership. Consumer expectations and requirements are changing, and these have made the industry focus more on connected and convenience features and solutions. This has also opened up new markets for technology companies, and we’ve been witness to many such new collaborations between traditional auto manufacturers and software giants. This is a trend that is likely to gain momentum in times to come, as more manufacturers open up to the realisation that they can’t be doing everything in-house.
This convergence is clearly leading to the development of a new automotive manufacturing ecosystem. In its report titled ‘2017 Automotive Trends’, Strategy& called upon automakers to examine new strategic channels to improve their return on capital. One of the three actions it suggests talks about automakers off-loading “more development work to technology suppliers. OEMs need to identify which aspects of a vehicle’s digital features they can hand-off to tech industry partners that have more expertise in designing and producing digital components and software”.
One of the most prominent collaborations we’ve had in recent times is the one among BMW, Intel and Mobileye – with Delphi and FCA joining in later – wherein all partners have come together to develop an autonomous driving platform. Without doubt, more such collaborations will emerge in the not-too-distant future, not just in mature markets, but also in our own backyard. OEMs, suppliers, service providers and tech companies will come together to form a new auto-tech ecosystem.
Deepangshu Dev Sarmah
New Delhi, November 2017