The Future of the Automotive Industry, The Disruptive Forces of AI, Data Analytics, and Digitization by Inma Martínez
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As the world becomes increasingly digitalized, conceptions of the car are undergoing a profound shift, says AI scientist Inma Martínez. Artificial intelligence and 5G are disrupting an entire industry, triggering innovations that can transform cities of the future, provided that brands work toward the collective good, explains Martínez. The future Martínez envisions is one in which driverless electric cars free humans to enjoy the ride through more connected, safer and sustainable cities.
Take-Aways
- The Digital Revolution is radically disrupting the automobile industry.
- 5G technology in connected car consoles will help drivers stay safe.
- Market a purpose-driven brand that embodies aspirational values.
- People personify cars to satiate ego-based needs and trigger positive feelings.
- Future car interiors are evolving according to the needs of passengers and drivers.
- Driverless cars could prevent accidents and free people from driving.
- Moving from gasoline-powered cars to electric vehicles (EVs) requires a mind-set shift.
- Cars of the future are smart and digital.
The Future of the Automotive Industry Book Summary
The Digital Revolution is radically disrupting the automobile industry.
The automobile industry is in the midst of a technological evolution. The move to essentially transform cars – which today feature digital dashboards and entertainment systems – into digital devices is a natural progression of the Digital Age. Collaborations between electronics and automobile industries have led to automation and computerization innovations that make driving safer and more efficient.
“The soul of the automotive industry is audacious, knows no borders, and dreams up futures like no other consumer goods industry.”
Automation is nothing new: BMW first developed a now-common feature, the Electronic Stability Control (ESC) system – which allows the machine to take control in critical situations – in the 1980s. IoT company and heritage brand Bosch, which leads in computerizing and digitalizing car systems, aims to make automobiles resemble home environments with smart devices. Bosch works with Mercedes-Benz to create a new paradigm for car design, one that involves more comfort and less driving. The automobile industry’s obsession with disrupting paradigms embodies the spirit of innovation. Manufacturers strive to create new solutions for old problems, while satisfying customer desire for speed, luxury, control and safety.
5G technology in connected car consoles will help drivers stay safe.
The creation of “in-car infotainment” disrupted the automobile industry, as passengers began streaming video content and music. Around 2006, Bay Area car manufacturers began meeting regularly to re-imagine cars as digital environments. In the 2010s, automobile manufacturers began installing Bluetooth into car consoles and adding GPS navigation systems, transforming the automobile into an interactive space in which drivers could make phone calls using voice commands.
Bosch created a vocal-recognition system that was multilingual, greeted drivers by their names and allowed people to speak naturally, as opposed to forcing them to use specific commands. Upgrading voice control interfaces improves public safety: Research from Germany’s Allianz Center for Technology shows that manually operating their navigation systems distracts drivers.
“As vehicles began to cruise the roads, seamlessly flowing in traffic, our capacity to multitask inside their cabins began to pave the way to interiors and multimedia consoles favoring all kinds of activities other than paying attention to the roads.”
After the 2008 financial crisis, a new kind of driver took advantage of the connected car: “Super-commuters” drove hundreds of miles per day for work, often in neighboring states or countries. Cars began offering office-like features, as drivers took conference calls or dictated memos. In 2012, California became the first state to allow driverless car trials.
Autonomous cars could free super-commuters to safely engage with the features and comforts the car environment provides. As the world telecommunications platforms upgrade to 5G, high-speed digital hubs will appear in global cities, along with 5G cars. As 5G improves connectivity, rapid growth in intelligent traffic and transportation management technologies will follow.
Market a purpose-driven brand that embodies aspirational values.
The pace of change and technological evolution is so fast today that companies find it more effective to market a brand than to fixate on the design features of individual products. View your brand as the architecture of the philosophical concepts that serve as the roots of your work, which can include the promise you make to your customer and your ethical standpoint. Create brand architecture by making emotional points of connection and customer value foundational to the ways people experience your product. Merge your brand’s core values, such as functionality, with aspirational values tethered to emotional states, such as joy. Don’t make empty promises – embed your brand with purpose.
“Today, when electric vehicles are making inroads into our streets, a new consciousness is emerging: What we drive can help the planet heal, save us money, and provide us with a new sensorial experience of driving, one that is subdued, silent, and open to let the sounds of the world come in.”
As automobile brands stop glamorizing fossil fuels and seek to create carbon-neutral technologies, they re-conceptualize their brands, embracing an ethos of corporate sustainability. When more competitors invest in the electric vehicle market, Tesla – the EV leader – must upgrade its brand image to include more conscientious, empathy-driven values that better align with shifting societal values. Tesla often neglects small details – a lack of armrests in the backseat, for example – that would boost the consumer experience.
People personify cars to satiate ego-based needs and trigger positive feelings.
For many people, cars symbolically embody their desires. People form emotional bonds with their automobiles. In James Bond films, luxury cars represent masculinity, sex appeal and power. In comedian Jerry Seinfeld’s series Comedians in Cars Getting Coffee, the host chooses each car to represent his comedian guests, situating the car as an intimate space for conversation. People often don’t select cars for rational reasons, but because they have emotional, aesthetic and sensory reactions that prompt consumption, along with behavioral patterns related to work or socialization. Many people experience a flow of oxytocin after buying a car, as the purchase affirms their ego-based perceptions of their identities.
“How have the automakers and their tactics turned us into this bunch of brand-obsessed, midlife crisis drivers?”
Countries capitalize on the national pride people feel regarding the vehicles they manufacture, using protectionist measures to support their home industries. The future branding of automobiles shouldn’t hinge on national pride or the desire to affirm the individual ego. People need cars that embody a visionary and iconoclastic ethos of the future.
Future car interiors are evolving according to the needs of passengers and drivers.
Car brands aim for competitive advantage by designing interiors that provide people with an experience of control, safety and comfort. For over a decade, all vehicle brands have embraced a new design paradigm, which centers around the question: If people aren’t manually driving their cars, then what should they do in them? Cars provide a sense of freedom and privacy, and during the COVID-19 pandemic, people feel safe inside an environment they can control.
“Slamming it hard, the door hydraulics and closing mechanisms let out the air, and hermetically close up the cabin, isolating you from the world’s noises, welcoming you into the soundproof nirvana of luxury interiors.”
The automotive industry’s move toward connectivity, sustainability and automation shapes all facets of design. The electric BMW i3, for example, features interior surfaces made from 80% natural, recycled and renewable materials, which aligns with the values of environmentally conscious consumers. Car interiors have become more modular, with changing parts and additional storage compartments, reflecting the diverse daily needs of consumers.
Car companies such as Volvo now design cars to better serve women – in 2019, most automakers still designed cars using data collected only from male crash test dummies, putting women at a higher risk of injury, given the typical differences in their size and weight from men’s size and weight. Manufacturers make sensor-enhanced car seats that take biometric measurements and positional data from passengers and drivers, then apply AI algorithms to adjust supports to help people sleep better or gain alertness.
Driverless cars could prevent accidents and free people from driving.
According to the professional automobile association SAE International, you can classify vehicles as having the following degrees of autonomy:
- Level 0 – This class of vehicle has no self-automatic functions, but can alert the driver to certain things, such as being low on gas.
- Level 1 – This vehicle has automatic features, such as Adaptive Cruise Control (ACC) and automated steering.
- Level 2 – This vehicle can brake, steer and accelerate autonomously, but requires the driver to stay alert in case he or she needs to take over.
- Level 3 – Vehicles such as the Audi A8 fit into this class, as they can predict outcomes and be situationally aware. The driver does still need to remain conscious in case he or she has to steer.
- Level 4 – In the UK, the government-funded initiative Project Endeavour is testing Level 4 vehicles, which can drive themselves, provided environments are predictable, and ideally, enable drivers to stop paying attention to the road.
“The intelligent machines that we are programming to function autonomously are precisely what machines were built for: precision, scalability, prediction.”
Automated and connected vehicles could reduce the number of traffic accidents – as human drivers are unpredictable – and give people more opportunities to rest by taking over the burden of driving.
Moving from gasoline-powered cars to electric vehicles (EVs) requires a mind-set shift.
The automobile industry centered around fossil fuels for more than a century, but now, due to government directives to reduce emissions, cars are becoming fully electric. The European Union announced plans to cut C02 emissions by nearly a third in 30 years, and its plan calls for more electric vehicles on the roads.
A number of countries and states plan to ban the sale of diesel cars – California will likely do so by 2040, while the United Kingdom and the Netherlands plan to do so in 2030. Norway, one of the nations leading the way toward expanding e-mobility, plans to allow only city buses, emission-light vehicles and commercial vans on Norwegian roads by 2025. Electric vehicles aren’t a new phenomenon: Between 1823 and 1876, most cars were electric, and some were steam-powered. By 2022, there may be more than 500 different EV models for sale globally, with 8.5 million EVs sold by 2025. To continue the shift to EVs, batteries must become more affordable; energy density must improve; and governments must build more charging infrastructure.
“Will you miss the roar of a gasoline engine? Perhaps not.”
A mind-set shift must also take place to transition to EVs: People must stop viewing electricity as something they hoard, and understand the value of sharing it with others when they have it in excess. They must become comfortable with the idea of green energy business models, in which they pay a subscription fee to charge their vehicles and sell back any excess capacity. Energy company Enel X is leading circular economy initiatives to create partnerships with energy operators, locations frequented by consumers and car manufacturers to build charging stations around the world.
People are starting to view transportation as a service: For a monthly fee of $500-$800 per month, for example, Volkswagen will provide an electric car and cover costs ranging from car insurance to electric fuel. It can take decades to switch the power source of an entire industry, but innovation centers are doing so in a way feasible, from a price standpoint, and offer drivers their desired experience.
Cars of the future are smart and digital.
In the future, humans will focus on problem-solving in areas in which they excel – unbounded creativity, intuition, abstract thinking and emotional intelligence – as machines take on automated workloads. Smart vehicles are connected vehicles, and part of the “Smart Society” innovators are striving to build. In this vision of the future, the world’s cities exist in an integrated edge- and cloud-based ecosystem; cars will connect to “Vehicular Ad hoc NETworks,” which turn other smart vehicles and spots on the road into information beacons.
Urban centers must contain spaces for flora, fauna and habitats. By optimizing municipal services with smart, connected technologies and investing in public transport and infrastructure for cyclists, the quality of urban life improves.
“The future is smart, and humans will be at the center of it.”
Private sectors and governments must treat people’s data ethically. People usually agree to share data when it’s in the interest of the common good, for example, to prevent the spread of COVID-19, but no one should suffer abuses of control and infringements of civil liberties due to the commodification of data.
About the Author
AI scientist and adviser on digital transformation Inma Martínez is a member of The Global Partnership on Artificial Intelligence’s (GPAI) expert group.