Both smart mobility and smart cities will get a push in this decade, balancing congestion, ease of movement, and pollution. From 2010 to 2018, upwards of USD 115 Bn was invested into mobility startups, of which 94% originated from outside the automotive industry.
Moreover, new regions, mainly China, are gaining significance within the automotive industry. Closely following it is India, where a wave of technology-driven megatrends is redefining mobility.
With electronics and software growing in prominence, automation is changing. Features that make mobility smart require skills outside traditional core competencies of automotive engineering, growing in its value in a vehicle. The software content of vehicles is estimated to grow at a compound annual rate of 11%, making up 30% of vehicle value in 2030.
Trends Giving Momentum to Smart Mobility
The automotive industry has historically been an engine of innovation because vehicles combine chemical, mechanical, and electrical technologies, along with semiconductors, sensors, and digital technologies. These trends are providing momentum to smart mobility.
Electrifying the electric vehicles
Electric vehicles sales grew from 2% of all vehicle sales in 2016 to 6% in 2020. By 2030, it is slated to reach 22%. China and Europe, and not far behind India, are placing stricter emission and fuel economy targets at national, state, and city levels. The potential will ramp up government regulation incentives to encourage adoption.
The declining cost of producing lithium-ion batteries is helping companies take incremental steps to reduce costs. In 2019, while Volkswagen invested around USD 44 Bn to develop EVs and increase its share of its sale to 40% by 2030, Ford devoted USD 500 Bn into electric truck startup Rivian.
On the other hand, startups are researching on battery technology and creating charging infrastructure. Recently, charging infrastructure startup Chargepoint received support from BMW and Daimler to build charging networks. Volvo extended support to fast charging statup, FreeWire.
EV auto bellwether Tesla became the world’s highest-valued automaker. Their research increased its knowledge base into solar roofs, home battery systems, power stations with energy storage, which has helped the company scale efforts and build influence.
Furthermore, various stakeholders are assisting in the emergence of the integration of the mobility industry with electricity grids.
Granting autonomy to machines
Self-driving vehicles will integrate six levels of driver assistance technology advancements.
- Level 0 – No automation: Driver performs all tasks
- Level 1 – Driver assistance: The driver receives some driving assistance features.
- Level 2 – Partial automation: Vehicles have automated acceleration and steering functions, while the driver monitors everything, including the environment.
- Level 3 – Conditional automation: The vehicle travels independently but needs a driver to control the vehicle when required.
- Level 4 – High automation: Vehicles perform all functions under conditions, while the driver has the option to control the vehicle.
- Level 5 – Full automation: Vehicle performs all functions. The driver may have the option to control the vehicle.
We already have vehicles using sensors, cameras, and radar to help vehicles identify obstacles and avoid crashes. We may reach level 4 by 2023. Fully automated vehicles offer increased safety, time savings, decreased environmental harm, and reduced costs.
Driver incapacity causes ¾ of vehicle accidents. Advanced Driver Assistance System (ADAS) includes adaptive cruise control, automatic braking, traffic and lane departure warnings, which could assist exhausted drivers. The ADAS market size in 2017 was USD 4.6 Bn, with the market set to grow at a CAGR of 19.01%.
While some automakers are working on full autonomy, some are prioritizing ADAS. Toyota is developing a vehicle that is “incapable of causing a crash.” Nonetheless, the ‘full autonomy’ market may reach USD 80 Bn by 2025.
Two such startups working on full automation are Waymo and TriEye. Honda, with a fund amounting to USD 750 Mn and SoftBank’s USD 900 Mn fund, is set to back startups developing their autonomous driving stack.
Simplifying life with vehicle-to-everything (V2X)
Vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communication refer to vehicle-to-everything (V2X) communication comprising of wireless technology enabling data exchange between vehicles and between vehicles and their surroundings. V2X can detect and inform vehicles of obstacles that are out of the line of sight.
When data such as traffic, speed, and position is shared with surrounding vehicles and infrastructure, V2X can inform the driver of potential risks, alternate routing, and traffic congestion. The V2V segment gets the major focus. Ruling the V2V roost are Cadillac CTS and Mercedes Benz E-Class, which comes with V2V.
V2X is still in the early stages with a few startups and corporations helmed by Qualcomm and Autotalks, working on and testing them with main drivers being increased pollution, growing safety trends, and connected vehicles. The market is projected to grow at a CAGR of 17.61% until 2014 to reach USD 84.62 Bn by 2024.
Redefining city travel with mobility-as-a-service (MaaS)
While alternative powertrains, EVs principally drive MaaS, on-demand business models efficiently bring a consumer-centric system of mobility from a vehicle-centric one. It started with ride-hailing and car-sharing but is expanding into bikes and scooters, referred to as micro-mobility as investor interest and consumer adoption is surging.
MaaS enables users to book transportation services on apps. It can book combinations of vehicles, including public transportation. MaaS is emerging as a viable alternative to personal vehicle ownership and facilitates intra-city and inter-city mobility, given that private transport is used only for 5% of the day. MaaS helps individuals avoid tax, insurance, parking, and maintenance costs.
Some of the current players are Zipcar, with its software allowing individuals to book vehicles for personal use, CargoX facilitating commercial vehicles, BlaBlaCar which allows shared mobility services; and Citymapper, which provides information on public transportation.
Finally, rising environmental awareness and motorized mobility costs are giving an impetus to bicycling and walking, which must be integrated into mobility services using AI/ML and other technologies, making cities smarter.
Almost every city worldwide has app-based services that are giving people access to bicycles. Many cities are creating dedicated bicycle lanes on the same lines as Amsterdam and other European cities.
To conclude, as we embrace innovative technologies in the transport sector, we need a new framework to guide urban mobility planning. The smart city framework must focus on enabling every one of various social statuses to access various urban services while also reducing motorized traffic.
Draup for Sales provides comprehensive intelligence on stakeholders giving sales teams insights into key auto players in the race to create mobility solutions to integrate with the smart city framework. These insights include their challenges and their organizational requirements.