The automotive industry has changed dramatically since Karl Benz designed and engineered the first road car powered by an internal combustion engine in the late 19th Century. The modern car is the culmination of over 130 years of technological innovation, but even today, the automotive industry is continuing to develop rapidly. In this article we will consider the trends driving the fundamental changes in the automotive industry and discuss where the industry is headed.
The movement away from internal combustion engines and fossil fuel powered vehicles had been attempted before, in the 20th Century, but several barriers impeded its adoption across the industry. The past decade has seen the meteoric rise of companies like Tesla and others, making substantial investments and advancements in EV’s. Barriers such as manufacturing costs and vehicle range have been overcome alongside the development of the digital age that nourishes technological advancement globally.
The British government recently announced a ban on new petrol and diesel cars from 2030, highlighting the fundamental changes in the automotive industry ahead, particularly with greater focus on the climate crisis around the world. This announcement will surely be mirrored by many other countries, many of whom have already announced strategies to implement green transport systems.
Many commerce sectors have adopted the digital transformation of the last 20 years and the automotive industry appears to be following suit. More companies are being established to cater to millennial online shopping habits and traditional car dealers are having to rely more on digital channels for lead generation. As younger generations become the primary target market for car dealers, the online customer experience will be as significant as the traditional dealer experience. That being said, the physical element of test driving and car inspections is likely to always be a necessary step in the purchasing journey.
The continued development of Artificial Intelligence (AI) promises to transform all areas of modern life, the automotive experience being no different. Tesla’s autonomous cars are already on the road, with many more companies entering the race for autonomous and connected vehicles. This signals a radical change to the automotive industry as a whole – the trade-off between the traditional driving experience and limiting human input.
Automotive leaders have already predicted the future of the automotive industry will be dominated by car sharing. With ever increasing urban sprawls across the globe, car ownership in congested cities will likely become redundant. Car sharing would entail an on-demand type system for automotive vehicles. Much like you would order a taxi with your phone, you could rent a car for a very short period to get you from A to B. This may seem like an odd process right now, but with advancements in autonomous vehicles and socio-geographic trends – this may be the future of the automotive industry.