Four arguments for connected cars
The global connected car market is projected to grow at an annual rate of 22.3%, increasing five-fold from $42.6 billion in 2019 to $212.7 billion in 2027. In a recent article, the World Economic Forum listed four excellent arguments for the growing importance of connectivity – and they rhyme well with the interests and objectives of corporate fleet managers.
In 2018, there were 46 million connected cars on the road worldwide. By early 2022, that figure will have risen by 270%, to 125 million. It’s a sign of the increasing demand for connectivity – a demand which will only increase as the technology advances.
In the not-too-distant future, 5G-connected cars will be standard in our fleets and on our roads. With that advanced level of connectivity, we will be able to expect a lot more from our vehicles than we can today. In fact, hyperconnectivity will completely transform mobility. Here’s how.
Every year, 1.3 million people die and up to 50 million people are injured in road accidents. Half of the deaths are pedestrians, cyclists, and other vulnerable road users. Hyperconnected cars will be fitted with ‘vehicle to everything’ (V2E) technology, allowing them to communicate with relevant road infrastructure and nearby road users. Making the vehicle more aware of its surroundings is the necessary first step towards preventing or mitigating accidents, including those involving third parties.
Drivers are constantly demanding a more luxurious driving experience, and connectivity will play a large part in delivering just that. A McKinsey survey found that 40% of consumers (and 61% of Chinese consumers) would change car brands just to have a better-connected vehicle. A 5G-connected vehicle will be able to seamlessly stream music, audiobooks and other entertainment.
V2E technology will be able to detect congestion and steer clear of it, reducing time lost in traffic at an individual level, but also congestion itself, at a city-wide level. That will lead to reduced emissions – as will the communication between vehicles and traffic lights, which will allow vehicles to adapt to the green light cycle, reducing stop-and-starts.
For OEMs, 5G represents an extension of revenue opportunities beyond the mere sale of the vehicle itself. Manufacturers will be able to create lasting relationships with customers, by offering them a wide range of additional services – including but not limited to predictive maintenance, remote diagnostics, and online service scheduling. Exactly the kind of services that lease companies would also like to provide. This could create new areas of competition that could ultimately benefit the connected car customer, who will be able to choose the most advantageous offers.