From Alex Smoker, Principal at Miramar Global
Automotive – what does a connected car actually mean for the sector?
We know that a connected car is a vehicle which accesses the ‘internet of things’ (IOT) through built-in software, but what does this mean in terms of its benefits and shortfalls – what are the opportunities it brings to the sector and what improvements need to be addressed?
The opportunities seem to be endless as this new capability is enabling conversations between varying sectors, who once worked in complete silos, to now collaborate to advance new technologies. According to figures from Statista regarding connected cars: “It is expected that the market will recover from the impact of the global coronavirus pandemic and grow to around 121 billion U.S. dollars by 2025.” This isn’t a stat to consider lightly, but there is still a long way to go and many obstacles in the path to success. What should organisations be considering with their plans over the forthcoming years and how will the quality of talent play a pivotal role?
Collaborations and opportunities for connecting other industries
As the automotive industry becomes more connected, the opportunities for collaboration and innovation between various other industries is only expected to grow. So far, we have seen great success from collaborations with software companies providing tools and platforms to allow developers to create new applications and services for connected cars. Furthermore, data analytics companies are working to develop tools to utilise the vast amounts of data generated by connected cars to provide personalised experiences and further improve the customer experience. These are just a couple of examples where collaborations are working. How can industries further advance technologies and what should be the ongoing focus? One prevalent opportunity that is in a period of growth is smart cities. According to an article by Automotive World it suggested that data generated by connected cars could provide valuable data to support machine learning tools which would in fact “…be analysed and applied on a larger scale to make smart cities and their infrastructures safer and more efficient.”
Negative impact of connected vehicles and how businesses can move forwards
As more cars are connected to the IOT they become increasingly reliant on innovative and robust software and electronic systems, which is creating new opportunities and challenges at the same time. The rise of vehicle connectivity is driving innovation in areas such as autonomous driving, electric vehicles, and mobility services, but greater exposure for automakers and consumers to cyber-attacks and cyber security issues. Security risks are possible in many forms, from the theft of personal data to the theft of a vehicle. Furthermore, accessibility issues such as loss of connection and manipulation of safety critical systems must be considered. This brings us back to the topic of other industry verticals such as tech companies and cybersecurity firms, who are now entering the automotive space and collaborating with automakers to tackle these issues. In addition to external industry collaborations, automakers are reviewing their internal operating structures and their talent pool to ensure they have sufficient talent and skills in areas such as software development and data analytics to face the challenges growing in the sector.
Regulations and cyber security are now front and centre in the automotive sector. Back in 2021, two new UN Regulations on Cybersecurity and Software Updates were created to “help tackle these risks by establishing clear performance and audit requirements for car manufacturers.” In the European Union the new regulation on cyber security will be mandatory for all new vehicle types from July 2022 and will become mandatory for all new vehicles produced from July 2024. Not only is it important to stay on the right side of the law, but to also keep up with savvy consumers. Chief Product Officer, Nic Surpatanu, oversees the Tanium product portfolio and hinted in a Forbes article that one day “the auto industry may one day adopt a cybersecurity rating system similar to the National Highway Traffic Safety Administration’s safety ratings, allowing consumers to shop for cars based on how well they meet security standards.” Therefore, the research and development teams should factor this into their ongoing plans for innovation to make sure that their teams are prepared for this.
References:
https://www.statista.com/statistics/725025/connected-cars-global-market-size-projection/
