What customers expect from autonomous mobility
November 6, 2019
The automotive industry is experiencing its biggest upheaval yet. In addition to the technological pressures of developing e-mobility vehicles, consumer demands for mobility services and autonomous driving are deeply impacting the industry. But what’s behind these trends and how can automakers respond?
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Survey: How will the needs of automotive customers change? Image: Joey Kyber/Unsplash
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Accenture surveyed 7,000 automotive consumers worldwide for the report, Mobility Services: The Customer Perspective, and identified the key issues driving change in the automotive industry. Report authors Daniel Tegtmeyer of Accenture and Tobias Kruse from Fjord explain in this interview how the needs of automotive customers are changing. They also discuss what car manufacturers must do to win the battle for direct customer access and achieve growth in the future.
Mr. Tegtmeyer, you’ve been instrumental in the development of this report. What is the focus of the report and how did you determine who to interview?
Daniel Tegtmeyer: With our studies, we always want to get to the bottom of the most important questions in the automotive industry. The big difference this time is that we’ve put the customer—not the automaker—at the center and mapped their view. We’re moving away from owning cars towards new trends like car-sharing and ride-hailing. Even robo-taxis are picking up speed when it comes to customer interest. But what exactly does this mean for the auto industry? Will these trends quickly come to pass like so many others? Or will they continue to grow in popularity, eventually remaking the industry into something automakers struggle to survive? In short, how threatening—or promising—is the current upheaval for manufacturers? This is what we sought to answer in our report. To do so, we surveyed 7,000 consumers from China, Europe and the US, including premium and volume brand buyers, and customers who do not own a vehicle.
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"We’re moving away from owning cars towards new trends like car-sharing and ride-hailing."
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Tobias Kruse: The focus of the survey was on five expected shifts: Manufacturers and vehicle brands’ loss of reputation in the mobility services market; the shift in customer preferences from vehicle ownership to vehicle renting and sharing; the willingness to pay for digital value-added services and expectations regarding the personalizability of vehicles interiors; and how mobility services are developing in rural areas.
Which of the report’s results surprised you the most?
Tobias Kruse: Our survey was conducted in very different markets. Respondents from Europe, the US and China often had significantly different answers and in this sense we weren’t surprised. And the trends we have long suspected as impactful are confirmed in principle by our study and thus hardened our general assessment. Most important, mobility services are putting the industry under considerable pressure.
And the nature of this pressure will change once autonomous vehicles are made widely available. However, there are some differences in the country and brand segment comparisons, which are essential for manufacturers’ strategies.
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Through Accenture's survey of more than 7,000 respondents in the United States, China and Europe they set out to answer five key challenges now and for the future of OEMs and auto executives around the globe.
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Of course, it can be surprising when assumptions are confirmed by the numbers and a trend becomes a fact. I was surprised that of all 7,000 respondents, almost half would willingly give up car ownership to switch to autonomous mobility solutions. Car manufacturers must be prepared to respond by moving their business model from a pure car manufacturer to a broker of mobility.
This is especially true of premium brand automakers—drivers of premium brands show the highest willingness to give up their own car in principle if autonomous solutions were made available. Brand strength alone no longer guarantees future success, and premium brands should act now and use the tailwind they still have to reposition their brand. Chinese companies in particular should heed this advice and work hard to develop platform-based and customer-centric business models.
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After all, 78 percent of premium car owners in China are considering relinquishing car ownership if there are adequate autonomous mobility solutions in place. Across all brands, Americans still highly value car ownership. As a result, the time pressures associated with autonomous mobility solutions are not felt as strongly US companies as they are in other countries. Still, US carmakers should now position themselves in preparation for competition. In Europe, the picture is somewhat different, and not just in the premium sector: Our study reveals that only 41 percent of European respondents in the non-premium sector indicate a willingness to switch.
Daniel Tegtmeyer: Our study found 34 percent of respondents would move to a suburb or even the countryside if autonomous vehicles were offered there. That surprised me. New mobility solutions can therefore change the trend of people moving to the city. In rural areas, people are more dependent on their cars than in the city, as rural public transport is underdeveloped.
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34%
of respondents would move to a suburb or even the countryside if autonomous vehicles were offered there
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Premium brands should be alarmed by this. Car owners in the high-price segment show a much higher willingness to change their place of residence if their daily commute is facilitated by autonomous solutions. Commuters from the non-premium sector are a little more reserved. This is why we advise car manufacturers to take a closer look at rural areas. By being the first to offer autonomous solutions in suitable areas, they gain a significant advantage over competitors.
What role will car brands play in the future?
Daniel Tegtmeyer: We included 16 criteria such as price, performance, safety, environmental friendless and the brand of the car. We found that the brand is the sixth most important factor for buying a car. But it’s only the 10th most important factor for car-sharing. Customers therefore do not book a brand when car-sharing, but instead a vehicle class such as premium, green, etc., similar as it is with taxis today. The customer demands the services “bring me from A to B,” so the market expects individual mobility that meets their current needs and these needs can be manifold. And since we assume that this market will take on a much higher priority in the future, established car manufacturers, who have so far been able to convince their customers to purchase their vehicles on brand strength, are facing great difficulty.
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Brand Strength: Brand Strength: Of the sixteen criteria (which included price, speed, flexibility, comfort, environment, and privacy, among others) the study-respondents of the overall see the ‘brand’ as the 6th most important factor for buying a car—but only the 10th most important factor for car sharing.
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In view of these changes, how can car manufacturers achieve further growth in the future?
Tobias Kruse: There are two hypotheses about this. On one hand, it will be necessary to implement add-on services to make money. These additional services are particularly important for younger people. Almost all respondents (97 percent) between the ages of 18 and 37 show a clear interest in additional services on autonomous mobility trips such as music or video streaming, wellness, catering or hotel services. The willingness to pay for these services is highest among respondents from China. That’s the state of play today. However, it is proven that the time is ripe for add-on services.
On the other hand, personalization options for travellers are becoming increasingly important. In the survey, almost 60 percent said that private space is considered the top criterion for commuting. We are therefore convinced that personalization when travelling will change significantly with the introduction of autonomous services. Today, most respondents combine comfort such as automatic seat adjustment with personalization. In an autonomous future, however, the focus will shift to application-related personalization.
Daniel Tegtmeyer: Car manufacturers should arm themselves or at least consider including such service offerings in their portfolio. Then they will be ready for when autonomous vehicles come onto the market. Even if the willingness to pay outside is not yet particularly high. However, it can be a huge advantage to be able to offer add-on services. And by the way, access to the customer and customer loyalty will be strengthened.
Competition for mobility as a service is fierce—and will become tougher, as new competitors are already operating on the market. The battle for direct customer access will also be fierce. Scaling is still the key to long-term success. Car manufacturers are in a good starting position. The core competence, the production of cars, must remain strong. However, the business model needs to change. New skills must be added. The car product needs to be further developed towards autonomous mobility and digital services. If it is not, car manufacturers run the risk of falling behind in an open race. But it’s not too late to get into an excellent starting position through which car manufacturers can take advantages of new potential and revenue opportunities.
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About the Authors
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