CX Insights - Trend Watch - Automotive Industry (ICYMI July 2023)
ICYMI - Yes, July brought us 2nd quarter results and the start of UAW negotiations, but it also brought continued news in the areas of chip shortage, software, subscriptions and dashboard changes – as well as reports of China's increasing influence in the EV space.
| CHIP SHORTAGE: NEVER AGAIN
The global chip shortage has been a major headache for the auto industry, causing production delays, inventory shortages, and lost sales. However, some automakers are taking proactive steps to secure their microchip supply and avoid future disruptions.
Stellantis, for example, is implementing an $11.24 billion strategy to diversify its chip sources, increase its inventory levels, and develop its own software.
Hyundai Motor chairman Chung Euisun recently toured Intel Corp.’s Leixlip Campus in County Kildare, Ireland, to examine how best Hyundai could collaborate with Intel and ensure stable chip supply for his OEM.
Both stories are important in showing that all global brands are serious about ensuring even a COVID-like event never interrupts auto supply. If this means deeper collaborations with large supply partners – or even rival OEMs – so be it.
| AUTO SOFTWARE DOMINATES HEADLINES
In software battleground news: As cars become more connected and intelligent, software and dashboard entertainment features are becoming more important for customers and automakers.
Fueling interest in controlling the dashboard is the ability to offer subscription services without any middleman, with some positive news supporting this strategy appearing this month. As reported in a recent survey by S&P Global Mobility, consumers are indeed willing to adopt some in-car subscriptions according to their preferences and needs.
That said, we see this month that OEMs are diverting strategies as it relates to CarPlay. For example, Porsche is updating how Apple CarPlay works in its cars, adding climate controls and more.
While GM previously announced it’s ending its partnerships with CarPlay and Android Auto, the OEM is now partnering with Google to offer a built-in feature in integrating Google Assistant, Google Maps, and Google Play, nicely demonstrated in this GM Authority article.
| CHINA: LAND OF AUTO OPPORTUNITY & CHALLENGE
China is the world’s largest and fastest-growing auto market, offering both great potential and fierce competition for global automakers. On one hand, Western automakers are implementing strategies to gain a larger share of the global market, such as GM cutting the price of its Lyriq EV in China by 14% after VW discounts.
On the other hand, whatever gains GM earns may be overshadowed by China company SAIC's purchase of established Western brands like Britain-owned MG as they seek to capitalize on brand heritage to break into the Western market.
Another Chinese brand that you should be paying attention to is BYD, which has become a 100 billion company and a leader in EVs, batteries, and solar power. Here's why global OEMs should pay attention to them – their sheer dominance in sales already outpaces VW in China and they're poised to go big sooner rather than later.
| MORE MISCELLANEOUS NEWS
Imagine a world where you can drive your car on the road, fly it in the air or walk it on rough terrain. Sounds like science fiction, right? Well, not anymore!
This month we learned about flying and walking cars. We've covered flying cars in previous blogposts, but the Alef Aeronautics' Model A is the first one with public implications: it's approved by the FAA for a Special Airworthiness Certification. That means public release isn't too far off!
Additionally, Hyundai recently had a patent approved for walking car technology. This patent, dubbed Project Elevate, was submitted over a year ago and has finally received approval for production. IT cannot be understated: This is a game-changer for mobility in hazardous areas, disaster zones, construction and handicap accessible areas.
Did I mention both of these stories feature all-electric vehicles?
For further information on how we got to where we are, I encourage you to check out our previous ICYMI blog posts throughout 2023.
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