Digital Transformation Drives the Automotive Industry Forward

By: Doug Bonderud - Leave a comment


The automotive industry has historically been a hardware-first market. From new engine designs to body aerodynamics and evolving fabrication materials, vehicle manufacturing and marketing have relied on the touch-and-feel aspect of technology to entice buyers, improve revenue and maximize efficiency. But now, digital transformation can’t be ignored.

“The rapid pace of digitization is transforming the component hardware-driven automotive sector to a software- and solutions-focused industry,” a new report by Frost & Sullivan asserts. Mobile innovation is changing the way companies in the sector can improve operations and bolster their bottom line.

Mobility Innovations Rise

According to McKinsey & Company, new business models fueled by shared mobility could increase automotive revenue pools by 30 percent. Data connectivity services such as applications, remote services and software upgrades make up a significant portion of this predicted boost. This focus is driven by user expectation for vehicles to come with baked-in mobile connectivity for phone calls, map searches, music playback and video display for passengers. As a result, automakers must invest in technologies like in-car wireless hot spots, companion vehicle apps and no-touch connectivity to stay competitive. As vehicles become integral to the connected living, automakers will inevitably shift from digital services to mobility-as-a-service.

Other key areas of digital transformation for automakers include autonomous vehicles and ride sharing. For example, General Motors recently invested $500 million into Lyft and purchased a Silicon Valley autonomous drive startup called Cruise Automation, according to Fortune. Tesla has even rolled out a summon feature that allows users to signal their car through their mobile device so the vehicle can drive itself short distances to their location.

These kinds of advances in mobility-enhanced vehicles provide huge market potential for automakers.

Overcoming Digital Transformation Hurdles

But knowing the value of digital transformation doesn’t always pave the way for effective implementation. For automakers, the shift to mobility-first initiatives comes with three challenges: accountability, security and marketability.

On May 7, 2016, a Tesla operating in autopilot mode slammed into a turning tractor trailer, killing the driver, Wired reports. And while the National Highway Traffic Safety Administration found that the autopilot wasn’t responsible and even noted that Teslas with Autosteer technology crashed 40 percent less frequently than those operated by humans, this decision didn’t squash concerns. Companies considering a move to mobile automation must think carefully about how they’ll handle product failures and what this means for their brand as a whole.

Last year, cybercriminals demonstrated that it’s possible to take control of a connected vehicle in motion and put occupants at risk, according to Scientific American. While the article notes that this attack requires massive effort, along with physical access to the vehicle, the huge number of default-credential Internet of Things devices already operating in the mobile space is enough to give most users pause. It’s therefore crucial for automakers moving to mobile-enabled access and control to develop robust security policies.

How do companies sell the idea of interconnected autonomous vehicles to the public? Although a transition toward ubiquitous mobility supports this cause, there remains a growing sense of unease about the security and safety of these enhanced vehicles. Vehicle manufacturers should invest in analytics tools to measure and report key metrics on the safety, usability and overall efficiency of these vehicles and then clearly relay this information to consumers. In a mobile-first world, nothing inspires confidence without proof.

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About The Author

Doug Bonderud

Freelance Writer

Doug Bonderud is an award-winning writer with expertise in technology and innovation. In addition to writing for Pivot Point, Security Intelligence, The Content Standard and Kaspersky, Doug also writes for companies such as McMurray/TMG and Straight North.