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World Car Trends 2016
“The New Technology Market Race” New York, March 2016
Management Summary Connectivity Our expert panel agrees that connectivity will be the key trend of 2016. The vast majority (78%) consider it to be a key factor when they evaluate new cars – this is an increase of 7 percentage points since 2013. The current connectivity fervour is mainly driven by three topics: 1.) New Safety Features In 2016, safety-related driver assistance systems are creating the strongest momentum. Of particular interest are pre-crash, brake assist, blind spot detection, adaptive cruise control and pedestrian detection systems. 2.) Autonomous Driving Media exposure of autonomous driving reached new heights at the 2016 Consumer Electronics Show, increasing in visibility for the sixth year in succession. The feature once most disliked – Autonomous Driving – is now becoming one of the most admired. However, legislation, and the need to ensure safety are the biggest challenges to the success of this technology. 3.) Smartphone Integration Apple’s IOS and Google’s Android dominate the handset market with their combined market share of 98%. They are expected to become tough competition in the automotive field too with their respective offerings Apple CarPlay and Android Auto. For now, OEM infotainment systems are still seen as the industry benchmark with Tesla’s system being evaluated particularly well.
After going through an initial “hype” period followed by a shift of attention towards BEV, Fuel Cell vehicles are now experiencing a re-focus. Our expert panel believes that by 2030 FCEVs will become a major threat to BEVs and ICE vehicles. The current concern in relation to FCEV success revolves around the hydrogen refuelling infrastructure. Advanced fuel-cell technologies that lower production costs and increase efficiency, as well as decreasing purchasing costs, government incentives and low operating costs are also in high demand. That said, even with the current concepts and technologies, our experts already provide plenty of praise and draw comparisons with BEVs. “Pain-free, fuss-free – quite enjoyable, is the experience of driving an electric vehicle”. With the ongoing NOx emissions crisis, 60% of the expert panel believe that this has had an impact on diesel engines on a global scale. Toyota has already voiced its strategy of slowly phasing out the internal combustion engine along with the prediction that “sales will be near zero in about 30 years”.
Shared Mobility Despite ranking consistently last in survey results from previous years, in 2016 shared mobility sees a surge to 3rd position with 20% of experts rating the trend as extremely important. This is heavily influenced by the rapid growth of Uber and its competitors which include Lyft (United States), Didi Kuaidi (China), Ola Cabs (India) and GrabTaxi (South-East Asia). Uber has even announced intentions to develop self-driving cars. Traditional automotive manufacturers have also been driving momentum. At the Barcelona “Mobile World Congress”, OEMs presented a smart key system which can provide time-limited access to the car. The continued and future development of similar access technologies can help pave the way for an increasing emphasis on shared mobility.
Increased competition for the mobility of the future
Smart efficiency / e-mobility remains one of the top trends of recent years. E-mobility increasingly thrives on merit instead of regulation. Stricter emission standards, oil prices, etc. become less important in the drive towards e-mobility. The most important factors that influence the roll-out of EV’s include increased range, cheaper batteries with higher capacity, quicker charging, availability of charging stations and a decrease in purchase costs.
The development of future technologies paves the way for new players in the automotive industry as well as disruptive new business models. Tech companies such as Google and Apple are entering the sector alongside additional competitors such as Tesla and the new Chinese brands. The hype surrounding the rise of new players is reducing, with most experts in 2016 expecting tech companies to become a threat within 10 to 15 years, rather than the 5 to 10 years they predicted in 2015. The perceived influence of Google and Apple as technology providers for the “digital car” is evident, although the main push still comes from established OEMs. Microsoft, new Chinese brands such as Faraday Future, and other tech companies play a tertiary role.
China is chasing its goal of 5 million e-cars by 2020 and became the biggest market for electric mobility in 2015. This has been achieved through strong governmental support and high tax breaks and resulted in the selling of more than 200,000 EV’s – twice as many as in the USA. More than half of all e-cars across the world are on the roads of China or the USA. Norway is the market with the highest market share, with almost 1 in every 5 cars now sold being a BEV, BEVx or PHEV. While Tesla hasn’t profited from the high momentum in China in 2015, the attention in the USA remains high: The Tesla Model S was the most visible car in US media in 2015. And we can see a new US EV leadership: Four out of the six top rated electric vehicles are made in America.
The position of new Chinese competitors as a potential threat to established car manufacturers is growing, with only 18% of our panel believing that they will never succeed. Some of the biggest barriers to success however are a low global profile and low trust in new Chinese brands. Apple and Google have a significant advantage in terms of brand value, with a brand value 10x higher than the Top 10 automotive brands. According to the 2015 Interbrand ranking, Apple and Google occupied the top 2 positions. Tech companies entering the automotive industry face three major challenges. Achieving sufficiently high standards of manufacturing and engineering that meet global safety and quality requirements, the creation of an industry-appropriate sales and distribution network and the financial attractiveness of the business. All are seen as major hurdles to overcome before new players can succeed.
Smart Efficiency
2
World Car Trends 2016 2015 | Sources Global Expert Community
Global Media Trends
75 World Car Jurors
Top 25 markets
Countries
All automotive brands [> 150] and models
Top opinion leading media (TV | print | online)
News channels
2014 – 2016: > 100 million documents (blogs, forums, networks)
Social channels
Sponsored by: Legend:
Media Analysis
Survey
Brands
Third-Party Research
PRIME Insights
Content Connected Mobility ›
Safety
›
Autonomous Driving
›
Smartphone Integration
Smart Efficiency / E-Mobility ›
Battery Electric Vehicles
›
Fuel Cell Electric Vehicles
›
Diesel Crisis
Shared Mobility The new competition about the mobility of the future
Connectivity | Key trend in 2016 and key evaluation factor for new cars Connected mobility has always been within the top 3 trends for the last five years, peaking in 2013 and 2016 as #1. 2012
2013
#1
2014
2015
#1 #1
#1
#2
2016
#1 Connected Mobility
#2
#3
#3
71% Already/Increasingly
#3
“Is connectivity a key factor in evaluating a car?”
78% Already/Increasingly
+7pp
No
Not yet
No
Not yet
[12%]
[17%]
[2%]
[20%]
“What are the most important trends in the automotive industry in 2012 / 2013 / 2014 / 2015 / 2016?” 2013 & 2016 Expert Panel: “Is connectivity a key factor in evaluating a car?”
5
#1 | Three key drivers for connected mobility #1
New safety features, autonomous driving and smartphone integration are the three key drivers for connected mobility.
New Safety Features
Connected Mobility Autonomous Driving
ď‚ľ PRIME Insights
Smartphone Integration
6
Safety-related driver assistance features see strongest momentum in 2016 New safety features have grown strongly in acceptance following technological improvements
mixed
important
very important
Pre-Crash Systems Brake Assist Systems
Strongly safety-related
Top 5
Blind Spot Detection Adaptive Cruise Control Pedestrian Detection
“Systems became much better in recent years”
Intelligent Lights Lane Keeping Systems
Automated Crash Reporting Traffic Sign Recognition Park Assist Attention Assist Night vision Systems 0
“How important and desirable are the following ‘Advanced Driver Assistance’ features from your point of view?”
1
2
2013 Expert Panel
2014 Expert Panel
3
2015 Expert Panel
2016 Expert Panel
7
#2 | Connected Mobility: Autonomous Driving #2
Autonomous driving has arrived in reality and will soon be available in series production cars.
New Safety Features
Connected Mobility Autonomous
Driving
ď‚ľ PRIME Insights
Smartphone Integration
8
Autonomous driving increasingly visible in global media 2016 brings an all-time high due to tech shows (e.g. CES, Mobile World Congress, etc.) and individual events. Autonomous cars in series production are expected within the next 3 years. Fully autonomous driving cars in series production
New alltime high CES 2016
High
are expected by 2019
Tesla Autopilot CES (MB, BMW, Audi, Ford) Breakthrough
IAA (MB S-Class)
Volvo City Safety
Ford Intellidrive
CES "Self-driving cars (Audi) now legal in California" Geneva (CNN) (Volvo Pedestrian Detection)
GM announces hands-free driving Cadillac
Media visibility
Google unveils driverless CES car (Audi A7)
x 10
Low
2010
2011
2012
2013
2014
2015
Global media analysis of all automotive coverage (Top 25 markets – top opinion leading media. Analysis unit: message contacts)
2016
2017
2018
2019 2019
“When do you expect to see fully autonomous driving cars in series production?”
9
Autonomous driving with no additional momentum in 2016 A steep learning curve over the last three years has changed journalists’ perceptions – the once most-hated Advanced Driver Assistance feature has turned into one of the most admired features. Autonomous Driving very important and desirable
3
2
2016 Expert Panel
2015 Expert Panel 1
2014 Expert Panel 0
2013 Expert Panel
-1
-2
not important / desirable at all
-3
“How important and desirable is ‘Autonomous Driving’ from your point of view?”
10
Autonomous driving not limited to luxury cars By 2020, autonomous driving will be a key technology in the full-size and luxury segment, while smaller cars as well as fun-cars (sports cars & convertibles) will have a lesser degree of autonomy.
No autonomy
Restricted to information & warning systems
Assist (e.g. adaptive cruise control)
Full control (Auton. driving)
Subcompact Cars (e.g. smart fortwo, Fiat 500) Compact Cars (e.g. Ford Focus, VW Golf, Toyota Corolla) Mid-size cars (e.g. BMW 3-series, VW Passat) Full-size cars (e.g. MB E-Class, Audi A6) Full-size luxury cars (e.g. MB S-Class, Lexus LS) Sports cars & convertibles (e.g. Jaguar F-Type, Porsche 911)
2015 Expert Panel
Degree of autonomy 2015 Expert Panel: “From your point of view, what degree of autonomy will find its way to the different car segments by 2020?”
11
USA, Germany, Japan remain key autonomous driving markets Due to high costs and the need for infrastructure, autonomous driving will be strongly pushed by the most developed car markets. reluctant
passive/conservative
proactive/aggressive
USA
USA, Germany and Japan are clearly seen as the key markets for autonomous driving.
Germany
Japan
UK
France 2014 Expert Panel
China
Italy
2015 Expert Panel
Spain
2016 Expert Panel -3
-2
-1
“Which markets will be the key drivers for autonomous driving?”
0
1
2
3
12
Safety is key to consumer acceptance of autonomous driving However, Car-to-Car communications and ethics are also seen as roadblocks before autonomous driving can be fully rolled-out to the markets. mixed
important
very important
Legislation is the BIGGEST challenge to enabling autonomous driving
Legislation (on federal & national level)
Safety is the key to consumer acceptance of autonomous driving.
Safety Industry standards for Car-to-Car and Car-to-X communications Ethics (e.g. system decision in crash situation)
Integrity of technology Consumer acceptance
Infrastructure investments Data protection
Extra costs New players (like Apple, Google) New business models & scenarios (e.g. car sharing)
Google and Uber with visions of shared mobility via autonomous driving cars are fuelling new business models 0
1
2
“From your point of view, how challenging are the following aspects to enable autonomous driving?”
3
2015 Expert Panel
2016 Expert Panel
13
#3 | Smartphone Integration #3
Smartphone integration makes cars much more personalised and extends the “connected self” to the car space.
New Safety Features
Connected Mobility Autonomous Driving
PRIME Insights
Smartphone
Integration
14
The most important infotainment feature – smartphone integration – means a cooperation with Apple and Google A full smartphone integration also implies full audio integration, navigation and web access, deeming a lot of current features redundant. mixed
important
very important
#1
Smartphone integration Audio features (e.g. Bluetooth audio streaming, webradio, satellite radio, USB-audio interface)
Google (Android) and Apple (iOS) together have more than 98% Global market share for smartphones (operating systems).
Navigation system (e.g. also for safety interaction with predictive route-data, etc.) Web access (e.g. apps, web-based traffic information and infotainment, access to search engines) Virtual cockpit / user-programmable instrument cluster (e.g. Audi TT) Head-up display Voice control Personalisation through learning algorithms and context awareness Communication features (e.g. e-mail functionality, communication apps) Touchpad / touchwheel Operator services (e.g. for reservations, bookings, remote vehicle diagnostics) 2015 Expert Panel
Converging of Connected Car and Smart Home Gesture control (e.g. recognition of ‘swiping’ or ‘pointing’)
2016 Expert Panel
Wearables (e.g. smart watch connected to car) -1
0
1
2
“Here is a list of in-car infotainment, communication, navigation and human/machine interface features. How important and desirable are the following features from your point of view?”
3
15
Domination by Google and Apple in the smartphone OS market Apple’s iOS sees a somewhat constant market share over the last 7 years, whereas Google’s – free – Android OS has reached exceptional levels of market domination. Windows phones and RIM OS only account for less than 2% of sales in 2015. While Symbian, which had more than 60% market share in 2007, has now completely disappeared from the market. 4 out of 5 phones are running on Android
100% Global market share held by the leading smartphone operating systems in sales to end users from 1st quarter 2009 to 4th quarter 2015
90% 80%
Globally, every second phone sold to end-users is running on Android OS
70%
Global smartphone sales (2015)
60%
82% 98% market share
50% Other 2%
40%
30%
16%
3GS
20% 4S
10%
5
4
6/Plus
5S/C
6S/Plus
0% Q1
2009
Q2
Q3
Q1
2010
Q2
Q3
Q4
Q1
2011
Q2
Q3
Q4
Q1
2012
Q2
Q3
Q4
Q1
Q2
2013
Statista.de: Global market share held by smartphone operating systems 2009-2015
Q3
Q4
Q1
2014
Q2
Q3
Q4
Q1
2015
Q2
Q3
Q4
Q1
2016
Q2
Q3
Q4
Q1
Q2
Q3
Q4
2017
16
“Apple CarPlay” gains strong momentum in 2016 Google’s Android Auto is not yet widely available, whereas Apple CarPlay was rolled out on a large scale in 2015. 2
very good
1,5
1
0,5
mixed
0
2015
2016
“From your point of view, how would you rate the infotainment systems of the following car manufacturers / tech companies?”
17
OEM infotainment systems are still the industry benchmark However, Apple and Google are very close with their infotainment offerings and are much better-evaluated than the worst 5 OEM infotainment systems. Tesla is highly praised for its infotainment system. mixed
very good
Best evaluated system (= from German premium manufacturer) Tesla
Apple ("Carplay")
Top 5 OEM Systems
Google ("Android Auto")
Worst 5 OEM Systems 2015 Expert Panel
Microsoft ("Embedded Automotive")
2016 Expert Panel 0
1
“From your point of view, how would you rate the infotainment systems of the following car manufacturers / tech companies?”
2
3
18
Content Connected Mobility ›
Safety
›
Autonomous Driving
›
Smartphone Integration
Smart Efficiency / E-Mobility ›
Battery Electric Vehicles
›
Fuel Cell Electric Vehicles
›
Diesel Crisis
Shared Mobility The new competition about the mobility of the future
E-Mobility remains a top trend in 2016 E-Cars rank second, only beaten by connectivity.
2012
#1
2013
#1
#2
2014
2015
#1
#1
2016
#2 #2
#2
#2 Smart Efficiency / E-Mobility
#3
Milestone:
> 1m e-cars on Global roads “What were the most important trends in the automotive industry in 2012 / 2013 / 2014 / 2015 / 2016?”
Source: zsw-bw.de | Includes: BEV, BEVx and PHEV. Does not include mild + full hybrids, motorcycles and commercial vehicles.
20
Key drivers for the E-Car trend are range, charging infrastructure and decreasing costs E-mobility increasingly thrives on merit instead of regulation. Stricter emission standards, oil prices, etc. become less important in the drive towards e-mobility. not important at all
mixed
very important
Increased range Advanced battery technology
Top 5
(cheaper batteries with higher capacity)
Quicker charging Better charging infrastructure (availability of charging stations)
“The ease of access to charging points that work. Not only are many more needed, but they need to be in convenient places, and a charger available when you arrive at one. Which works. Real-world practicalities like these are underestimated.”
Decreasing purchasing costs Government incentives Stricter emission standards
Low electricity cost High oil price Lightweight technologies Fun to drive
Tesla Model X: +333kg compared to Model S = 2,441kg.
Clean electricity production New players on the market (e.g. Apple, Google or Amazon)
Increased popularity of shared mobility Stagnating efficiency of IC engines -3
-2
-1
0
1
“From your point of view, how much will the following factors influence the roll-out and success of Battery Electric Vehicles (BEV)?”
2
2015 Expert Panel
3
2016 Expert Panel
21
China and USA with strong e-mobility momentum Some European countries still show poor performance in paving the way for e-mobility, still without any form of incentives. very poor
mixed
very good
Norway Japan Germany France China
Ambitious plans:
USA
Strong momentum
5 million e-cars in 2020
UK
Italy Spain -3
“Which markets will be the key drivers for e-mobility?”
-2
-1
2014 Expert Panel
0 2016 Expert Panel
1
2
3
22
Norway: EVs achieve a 19% market share in ’15 Despite being surpassed in 2015 by the Netherlands regarding overall sales, Norway remained the top EV market in the world with regards to market share. Electric vehicles registration figures in Norway 40.000
›
The EV market in Norway grew by 50% in 2015 and 130% in 2014 compared to previous years
›
No purchase tax, no VAT and no tolls are making EVs very attractive.
›
Free and extra parking areas for EVs.
›
EV infrastructure.
›
Clean Norwegian energy production.
35.000
+ 50% 30.000
25.000
20.000
+ 130% 15.000
10.000
5.000
0
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Source: zsw-bw.de | Includes: BEV, BEVx and PHEV. Does not include mild + full hybrids, motorcycles and commercial vehicles.
23
China becomes #1 Global market for e-mobility Slow-down in America, but breakthrough in China. Germany with a very low performance in 2015, overtaken by most other European markets. Also smaller markets like Netherlands or Norway have sold more e-cars than Germany in 2015. New EV registration figures by market
Total number of different electric models on global roads by December 31st, 2015
250.000
Nissan Leaf Tesla Model S
200.000
Chevrolet Volt Mitsubishi Outlander PHEV
Factor x 1.8
150.000
Toyota Prius PHEV BYD Qin PHEV BMW i3
100.000
0
50.000
•
Netherlands
•
Norway
•
UK
•
France
•
Germany
50.000
100.000
150.000
200.000
0 2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Source: zsw-bw.de | Includes: BEV, BEVx and PHEV. Does not include mild + full hybrids, motorcycles and commercial vehicles.
2018
24
New energy vehicle production in China takes off in 2015 China tries to achieve its ambitious goal of 5 million e-cars in 2020 with high tax breaks on electric vehicles.
120.000
100.000
Commercial PHEVs
80.000
Commercial EVs
60.000
40.000 Passenger PHEVs 20.000 Passenger EVs
0 Apr '14
May '14
Jul '14
ď † Source: miit.gov.cn
Aug '14
Sep '14
Oct '14
Nov '14
Jan '15
Feb '15
Mar '15
Apr '15
May '15
Jun '15
Jul '15
Aug '15
Sep '15
Oct '15
Nov '15
Dec '15
Jan '16
Feb '16
Mar '16
Apr '16
May '16
Jun '16
25
USA still leading in total number of EVs The USA sees the most dramatic increase in the total number of EVs over the past years, closely followed by China. Total number of electric vehicles on the road by January 1st of each year
450.000
# charging stations / outlets in the US (US Department of Energy; as of February 2016)
400.000
40.000
55% market dominance by USA and China
30.847
30.000
350.000
20.000
12.271
10.000
300.000
USA 31%
Other 45%
China 24%
0 Charging stations
250.000
Charging outlets
200.000
150.000 100.000 50.000 0 2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
ď † Source: zsw-bw.de | Includes: BEV, BEVx and PHEV. Does not include mild + full hybrids, motorcycles and commercial vehicles.
2019
26
E-cars are still heavily subsidised The Netherlands has relatively low tax breaks on purchases, but the highest recurring tax exemptions. Norway, China and Italy also with (lower) recurring tax exemptions. All other markets have a one-off purchasing tax break. Tax breaks on purchase and use of electric cars (January 2014)
Norway
Most important EV incentives
Free toll roads
16.910 €
China
No purchase tax
7.546 €
France
6.022 €
Japan
5.976 €
United States
High recurring tax exemptions
5.365 €
Italy
3.810 €
Germany
Access to bus lanes
14%
Free parking
11% 10%
Free charging
4%
Charging Network
4%
Free ferries
150 €
0€
15%
Low annual road fee
5.512 €
Netherlands
17%
Low fuel costs
6.500 €
UK
23%
5.000 €
10.000 €
15.000 €
20.000 €
2%
0%
5%
10%
15%
20%
25%
McKinsey & Company
Most important EV incentives: “Norwegian electric car user experiences” study of the Norwegian Electric Vehicles Association
27
Four out of six top EV’s are made in America BEVs gain further credit in 2016 due to Tesla Model S and Chevrolet Bolt – Electric vehicles made in the US might be game changers in the future. very poor
#1
Tesla Model S
#2
Chevrolet Volt
#3
Chevrolet Bolt
mixed
very good
New US EV leadership
…
…
#6
Tesla Model X -3
-2
-1
“How would you rate the following e-cars from a general perspective?”
0
1
2
2016 Expert Panel
3
28
Tesla Model S was the most visible car in US media in 2015 While the actual market share of the Model S is quite low, its media presence in US media is outstanding.
Top 3 vehicles in US media in 2015
Tesla Model S
#1
3,3%
Ford Mustang
2,8%
Chevrolet Corvette
2,1%
0%
1%
2%
3%
4%
5%
100% = all automotive coverage in US media in 2015
 Global media analysis of all automotive coverage (US market – top opinion leading media. Analysis unit: message contacts)
29
Tesla’s irrational business model OR “The Big Bet” Tesla is particularly strong in the US, but didn’t profit from the high momentum in China in 2015. Tesla has made constant losses since 2008. = ~ 3% of Ford‘s annual revenues
4500 4000
4.046
Tesla's revenue (in m USD)
-100 -200
3.198
3500
-83
-56
-74 -154
-300
3000
-254
-294
-400
2500
2.014
-396
-500
2000
-600
1500
-700
1000 500
0
15
112
117
204
-800
413
-900
0
-1000 2008
2009
2010
2011
2012
2013
2014
2015
Tesla's net income/loss (in m USD) 2008
2009
2010
-889 2011
2012
2013
2014
2015
2500 Tesla's revenue by region (in m USD) 2000 1500
Other markets
1000 500 0 2012
Source: Tesla 2015 annual report
2013
2014
2015
2016
2017
30
Fuel-cell technology ramps-up for a second time In the last 10 years, Honda showed the strongest ambitions of all manufacturers regarding fuel cell technology, followed by Hyundai/Kia and Mercedes-Benz. Plus more recently, Toyota.
Fuel-Cell “Hype“ period
Attention-shift to BEV
Re-Focus on FCEV
Most major manufacturers focus on FCEV as battery technology is not improving fast enough, the range issue, as well as high costs, are considered hard to solve.
First volume BEVs available on market and hype begins. OEM‘s shift focus on battery electric vehicles instead of continuing their FCEV strategy.
Manufacturers, especially Toyota & Hyundai/Kia, continue to focus on FCEV. In 2014, announcements of affordable FCEVs in series production strongly increase.
FCEVs will become a threat to BEVs or ICE vehicles in Comeback as “Next Generation EV”?
2030
2,0%
1,5%
1,0%
0,5%
100% = all automotive coverage in respective year 0,0%
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028
Global media analysis of all automotive coverage (Top 25 markets – top opinion leading media. Analysis unit: message contacts)
“When will fuel-cell electric vehicles (FCEVs) become a threat to either BEVs or internal combustion engined vehicles?”
2030 2030
31
Toyota clearly dominates FCEV coverage in 2015/2016 YTD Hyundai and Honda are also highly visible with their fuel-cell technology.
60%
“There’s an emerging rivalry between two different technologies for zeroemission transportation: battery-electric cars and hydrogen fuel-cell vehicles.”
“The relationship between hydrogen and pure electric cars is a fascinating topic that’s only going to get more interesting.”
Other 16% 11%
13%
100% = all fuel-cell coverage
Global media analysis of all automotive coverage (Top 25 markets – top opinion leading media. Analysis unit: message contacts)
32
Hydrogen infrastructure is the biggest challenge for FCEVs While costs are an issue for both technologies, FCEVs are much less dependent on advanced battery technology and increased range. less important
mixed
very important
Advanced battery / fuel-cell technology (BEV: cheaper batteries with higher capacity / FCEV: lower production costs, higher efficiency)
Increased range Rapid charging possibility General charging / refuelling infrastructure / availability Decreasing purchasing costs Government incentives Stricter emission standards
High oil price Lightweight technologies Low electricity costs / Low operating costs Fun to drive Clean electricity / hydrogen production New players on the market (e.g. Apple, Google or Amazon)
BEV 2015 Expert Panel
Stagnated efficiency of diesel / petrol engines
FCEV 2015 Expert Panel
Increased popularity of car sharing -1
0
1
“From your point of view, how much will the following factors influence the roll-out and success of Battery Electric Vehicles (BEV)?”
2
3
33
Key markets for FCEVs are USA, Germany, Japan and South Korea Linked to the involvement of Japanese, German, American and South Korean manufacturers in the FCEV technology, their home markets are seen as the key drivers for this new technology. reluctant
passive/conservative
proactive/aggressive
Japan
USA, Germany, Japan and South Korea are clearly seen as the key markets for FCEVs.
Germany USA South Korea China UK France Italy 2015 Expert Panel
Spain -3
-2
-1
“Which markets will be the key drivers for FCEV technology?”
0
1
2
3
34
Hydrogen infrastructure is the key to FCEV success Car sharing or new players won’t have any impact on the success of FCEVs. Interestingly, “fun to drive” is also not seen as a key factor. not important at all
mixed
very important
Hydrogen refuelling infrastructure Advanced fuel-cell technology (lower production costs, higher efficiency)
Decreasing purchasing costs Government incentives Low operating costs Stricter emission standards High oil price Increased range Clean hydrogen production Lightweight technologies Fun to drive Stagnating efficiency of ICE New players on the market (e.g. Apple, Google or Amazon)
2015 Expert Panel
Increased popularity of car sharing -3
-2
-1
0
1
“From your point of view, how much will the following factors influence the roll-out and success of Fuel Cell Electric Vehicles (FCEV)?”
2
3
35
Praise for all fuel cell vehicles FCEVs receive a lot of praise from the experts.
mixed
very good
Toyota Mirai
Third generation FCEV Honda FCEV (Concept)
Hyundai ix35/Tucson FCEV 2015 Expert Panel 0
“How would you rate the following FCEV from a general perspective?”
1
2
3
36
“Pain-free, fuss-free – quite enjoyable, as is the experience of driving an electric vehicle.” Overall positive driving experience of FCEVs.
“[…] a very good way to drive in terms of dynamics […] no range problems and no battery issues, close to the ideal.”
“Impressed by how normal it is to drive and how production ready it is.” “They're impressive for their ease of driving, quietness, range and speed of refuelling.”
“It’s an e-car and drives like an e-car.” “Completely unremarkable - just like a regular electric car.”
“It's a different driving behaviour. You are more focussed on saving energy while driving than enjoying the fun of driving dynamics.”
“They remain, to my mind, a bit unrefined and in need of more work.”
“They are uneventful and dull, overweight vehicles with futuristic pretensions, like most BEVs.” “Have you driven a “Fuel Cell Electric Vehicle” (FCEV) yet? If yes, what was your experience?”
37
The NOx emissions crisis is a Global crisis Only a few experts think that the crisis will exclusively affect diesels in the US.
35%
35% think that Diesel will only suffer in the US.
Special survey January 12th, 2016: “In which markets will diesel suffer from the crisis?”
60% 60% think that Diesel will also suffer outside the US.
38
But… Is diesel dead? Toyota has made a bold move by slowly phasing out its diesel engines, whilst journalists raise the note on the environmental impact.
Toyota heralds the end of the diesel-engine
Dirty secrets
“The Japanese car industry slowly says goodbye to the diesel engine. Toyota has announced that it will stop developing new diesel engines.“ welt.de, 11.11.2015
“Some fear that this may be the “death of diesel”. So be it. There is still scope to improve the venerable petrol engine; and to switch to cleaner cars that run on methane, hydrogen and electricity, or are hybrids. A multibillion-dollar race is already under way between these various technologies, with makers often betting on several of them as the way to meet emissions targets.”
This is Toyota's plan to stop making gas and diesel cars
Economist.com, 26.09.2015
“While petrol-reliant cars will not be completely eliminated in the future, especially in some regions of the world, Toyota is predicting gas and diesel car sales will be near zero in about 30 years.” techradar.com, 14.10.2015
The Dimming of Diesel Fuel’s Future in Cars
Hybrid technology to fill autos gap as diesel damaged by scandal
“Gasoline-powered cars are not the only ones that makers of diesel cars have to worry about. Coming up in the fast lane, even if there’s little traffic there now, are hybrid and electric vehicles.”
“With diesel potentially falling out of favour, automakers and their technology suppliers will likely turn to non-diesel solutions in a stricter regulatory environment. Over the next five years and beyond, auto industry officials see hybrid technology - especially heavily electrified plug-in hybrid know-how emerging more into the mainstream.“
Nytimes.com, 08.12.2015
Reuters.com, 28.10.2015
Various Online Sources
39
Content Connected Mobility ›
Safety
›
Autonomous Driving
›
Smartphone Integration
Smart Efficiency / E-Mobility ›
Battery Electric Vehicles
›
Fuel Cell Electric Vehicles
›
Diesel Crisis
Shared Mobility The new competition about the mobility of the future
“Shared Mobility” – an ignored trend? Shared mobility has always been ranked last in our survey since 2012. Nevertheless, the topic seems to be slowly gaining momentum. 2012
2013
2014
2015
2016
Percentage of experts rating trend as extremely important
#1 #2 #3
#3
Shared Mobility
20%
#4
#5 #6 #7
#7
#7
#7
#7
“What are the most important trends in the automotive industry in 2012 / 2013 / 2014 / 2015 / 2016?”
41
Uber | The new game changer paving the way for shared mobility Self-driving cars are playing a major role in Uber’s future plans to provide transportation for “everyone and everything everywhere”.
UBER-Facts: ► Worth 62.5b USD ► 1/10 of Apple’s value ► Active in > 50 countries; 400 cities ► China: Ø > 1m rides daily
► 2015: > 10b USD in global bookings
New competition: Uber competitors, Lyft (United States), Didi Kuaidi (China), Ola Cabs (India), and GrabTaxi (South-East Asia) (all of which have Softbank as an investor) announce a global technology and service alliance. With the exception of Lyft (which is the runner-up to Uber in the United States), all the other companies in the partnership are market leaders in their respective regions of focus. Source: wikipdia.com; newsroom.uber.com
42
Future access technologies pave the way for an increasingly “shared” mobility Volvo presented a smart key system at the Barcelona “Mobile World Congress“ which can provide timelimited access to the car.
Source: media.volvocars.com
43
Content Connected Mobility ›
Safety
›
Autonomous Driving
›
Smartphone Integration
Smart Efficiency / E-Mobility ›
Battery Electric Vehicles
›
Fuel Cell Electric Vehicles
›
Diesel Crisis
Shared Mobility The new competition about the mobility of the future
Future technologies are paving the way for new players ‌ as well as new business models in the automotive sector. The current hype surrounding connected mobility is mainly driven by three topics: Autonomous driving, smartphone & internet integration and new controls & displays.
Connected Mobility
New Chinese Competitors
Additional competitors Future Technologies
E-Mobility
Shared Mobility
New business models
ď‚ľ PRIME Insights
45
The hype is over In 2016, most experts think tech companies will become a threat in 10 to 15 years, whereas in 2015, they estimated between 5 and 10 years.
2016
18%
56%
2015
38%
68%
“Within the next 5 years”
“Within the next
10 years”
22%
22%
16%
19%
“15 years or longer”
“Never”
“When will tech companies (like Apple, Google, Amazon) become a challenge to the established car manufacturers with their own cars?”
46
OEMs are seen as key drivers for the “digital car” Google and Apple are clearly seen as technology providers, but the main push still comes from the established OEM’s. Microsoft and other tech companies play a tertiary role. passive/conservative
proactive/aggressive
OEMs themselves
Established
(e.g. Toyota, Audi, Tesla, BMW, Mercedes-Benz)
Automotive suppliers (e.g. Continental, Harman, Delphi)
New tech-driven Chinese brands (e.g. Faraday Future)
Other tech companies (e.g. Blackberry, CloudCar) -1
0
“Which companies will be the key drivers for the ‘digital car’?”
1
2015 Expert Panel
2
2016 Expert Panel
3
47
New Chinese competitors play an increasing role in electric mobility Only 18% believe that they won’t succeed at all.
Only 18% of the experts think that the new Chinese competition will never become a threat to the established car manufacturers.
18%
12 Years
“Never”
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
“When will any of the Chinese new players (like Faraday Future, Harmony Futeng (Tencent)) become a threat to established car manufacturers?”
2029
2030
48
New Chinese competitors need to raise their profile outside of China Low profile and low trust in the success of the new Chinese competitors. All Chinese experts know the new Chinese brands not likely at all
Only 82% of the Global experts know e.g. Faraday Future Publicity
very likely
82% 100%
Faraday Future (LeTV) 70%
Greatwall Huaguan (www.ch-auto.com)
100% 64%
Harmony Futeng (Tencent & Foxxcon)
100% 56%
Wanxiang Auto (www.wanxiang.com.cn)
100% 60%
Nextev (www.nextev.com)
100% 58%
Pateo (www.pateo.com.cn)
100% 54%
Ali Auto (www.alcheche.com)
100% 58%
Xiaopeng Auto (www.xiaopeng.com) Zhicheauto (www.zhicheauto.com)
100% Chinese experts -3
-2
-1
52%
2016 Expert Panel
All experts 0
1
2
100% 3
0%
20%
40%
60%
80%
100%
mixed
“In your opinion, will the new EV/tech-driven Chinese car brands succeed with their own vehicles?”
49
…but “they don't know what they don't know.” Low profile and low trust in the success of the new Chinese competitors.
“The Chinese have no idea how hard it is to design, engineer and sell cars. They need to undercut on price to get people to take a risk and buy one of their unknown cars. But as their costs go up they need to charge more (and therefore discount less). It's a steeper climb and a longer journey than they realise. And frankly I'm sick of their arrogance "we're going to overtake Toyota by 2020". Get real.” “No brand recognition outside of China (perhaps). Too big a time lapse before the tech becomes viable on a large scale for these small companies to survive. No product to sell.” “Step away from copying. Hire very experienced engineers from western brands, (copy S-Koreans who were able to catch up quite quickly, recent example = Hyundai hiring Biermann from M GmbH for their N-division). Imply connectivity/safety features asap.” “To not be perceived as a Chinese company. To have production outside of China. To rely on established suppliers. To pass EU and U.S. federal safety standards. To establish strong dealership networks who demonstrate an ability to quickly and properly service vehicles; MG Motor UK, one of the first Chinese ventures in the west, has not done a good job here.”
“From your point of view, what are the key factors for the new Chinese tech-driven manufacturers //(like Faraday Future, Harmony Futeng (Tencent))// to succeed in the car sector?”
50
Apple and Google with a brand advantage? Apple and Google have a 10x higher brand value than the Top 10 automotive brands.
Rank
Brand
Percentage change 2015 vs. 2014
#1 #1
Apple
+43%
#2 #2
+12%
Brand value (in billion U.S. dollars) 170m 120m
‌ #6
Toyota
+16%
#11
BMW
+9%
37m
#12
Mercedes-Benz
+7%
37m
#19
Honda
+6%
#35
Volkswagen
-6%
13m
#38
Ford
+6%
12m
#39
Hyundai
+8%
11m
#44
Audi
+5%
10m
#49
Nissan
+19%
9m
#56
Porsche
+12%
8m
49m
23m
0m
ď † 2015 Interbrand ranking
50m
100m
150m
200m
51
Three major challenges for tech companies entering the car biz 1
2
Manufacturing and engineering
Sales and marketing
›
Safety
›
Sales and distribution network
›
Quality
›
›
No manufacturing history
Maintenance / service infrastructure
›
Perfection in mechanical terms
›
Image
›
No experience, not much knowledge about car customers
›
Global development requirements
“Striking the balance between manufacturing, quality and sales.”
“Assembly quality is a tricky thing that takes years to get right.”
“I can easily imagine them re-inventing the car as super-sophisticated means of infotainment-in-motion, but the most down-to-earth mechanical problems aren't easy or fast to comprehend.”
“All in all, to keep customers satisfied with new products will be challenging.”
“Car customers cannot be treated by an arrogant business model as for example the way Apple treats its iPhone customers today!”
3 Financial attractiveness ›
Slim profit margin (compared with technology sector)
›
Economies of scale
“Their biggest issue will be their willingness to accept car industry margins of at best 10 percent and at worst in the mid decimals. It's not what they're used to.”
“The challenge that they mount against each other, as non-automotive new entrants majoring on much the same product advantages. And the possibility of a backlash against their dominance, which might even lead to their break-up.”
“What will be the biggest challenges for tech companies (like Apple, Google, Amazon) to enter the car sector with their own vehicles?”
52