Sarwant Singh, Frost & Sullivan: “Fleets, please start doing intelligent mobility pilots”
The car, a key element of tomorrow’s intelligent mobility landscape? Frost & Sullivan is already thinking further ahead. “Everything is becoming a marketplace, the car as well”, said Sarwant Singh, the global consultancy’s Managing Director, opening the Intelligent Mobility conference.
Earlier this month, the 11th annual Intelligent Mobility conference brought 400 automotive, fleet and mobility experts from 28 countries to London, to learn about the new use cases and business models that are coming online as we shift from a car-centric automotive industry to a user-centric mobility ecosystem. Singh’s main message: “Suppliers and industry players can all benefit from business models that don’t just see the car as an intelligent mobility mode, but also as a marketplace for customer-centric services.”
Which trends are currently powering the shift towards mobility?
“First off, the shift is unmistakeable: we’ve seen mobility go from nowhere to an almost $80-billion industry in just two years, growing at up to 14% a year.”
“A key aspect is mobility as a marketplace. The big trend is that the ecosystem is widening, which is why Amazon is one of the sponsors of the conference: they see that 15% of the cloud market could be generated by the automotive industry. That’s because cars will generate much more data than smartphones – and that data needs to be stored and processed.”
“This is the foundation for new industries, with new players. The industry is now starting to figure out how to monetise data. I believe 5G and IoT (Internet of Things, Ed.) will become very important for this. Autonomous will also play a role, but this is still a few years away. But electric is upon us now, and within shared mobility we see demand-responsive transport and Mobility-as-a-Service become very important.”
Which corresponding business models will arise?
“Mobility modes like ride-hailing, car-sharing and car-pooling already have functioning business models. Autonomous mobility will bring more disruptive business models, because it will fundamentally lower the cost of driving. How to monetise that? For OEMs, that’s the key question. For example, do you charge a commission from Netflix is the customer is beaming through a movie into the car? My favourite future business model is ‘build, operate or maintain’: OEMs taking care of all those aspects of electric and/or autonomous vehicles, in restricted environments like airports or cities.”
But are OEMs agile enough to lead the mobility transformation?
“Five years ago, I would have agreed that OEMs are slow to react. They were ‘disrupted’ by Tesla and Uber. But that’s the beauty of the car industry: OEMs are slow, but like elephants, once they start running, they’re unstoppable. Toyota, GM, BMW and others have set up joint ventures in the new mobility marketplace. They’ve learned that spinning off separate subsidiaries and hiring clever people from Google, Apple and other tech players is the way forward. But not all OEMs are elephants. Some are dinosaurs – no, I won’t name them!”
How long before mobility in Europe is truly connected, electrified, smart and autonomous?
“It’ll be another 4, 5 years. We’re delayed because the technology is not yet there, especially for Level-5 autonomy. I think the advent of 5G will accelerate the evolution. Also, legislation isn’t yet ready to allow autonomous vehicles on the road. It’s all a matter of time!”
But is public opinion ready?
“I think so, and I’ll tell you why. I have an EV. It was a big change, but now it’s a habit. To be honest, I find it hard to drive an ICE (internal-combustion engine) anymore: it’s noisy and polluting. And think of when you’ll have an autonomous car and you’re stuck in traffic. Turn control over to the car and read a book! That’s the beauty of these new technologies: they give you actual benefits. So customer acceptance will be very high.”
Final question. Say, I’m a fleet manager at a big multinational. I want to go down the mobility road but don’t know how. What do I do?
“Corporates generally have a very low understanding of what mobility can do for them. But things are moving. And it’s not just about mobility management, but at the same time also about travel management and expense management – with huge benefits in terms of cost saving and time efficiency. Firstly, EVs bring huge benefits to places where fuel is expensive. Secondly, autonomous vehicles will take manual driving out of the equation, helping to reduce TCO and change the role of the driver. My recommendation? Fleets, please start doing pilots. They’ll help you understand the benefits, and this will convince you.”
Sarwant Singh, the global consultancy’s Managing Director, opened the 2019 Intelligent Mobility conference.