Digitisation transforms the automotive sector

Digitisation transforms the automotive sector

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Consulting firm Frost & Sullivan discuss new growth opportunities as automotive sectors are expected to rise by US$2 trillion by 2025.




Digitisation is rapidly transforming hardware-driven automotive sectors to software and solution industries, causing characteristics of the mobility value chain to be digitalised in the future, because of higher software dependency.

Consumer demands for new and innovative digital services will influence components of the automotive industry, however, mobility as a service will be most visible within the process.

“As information services, in particular, become more sophisticated, the potential to integrate and aggregate mobility services is increasing. This allows customers to plan, book and pay for their journeys on the smartphone in real time. To make this effective, partnerships between both private and public transport providers are essential. The revenue potential of such digital mobility services is expected to rise to US$2 trillion by 2025 globally, explaining the continued interest from the private sector,” explains Swetha Surender, Programme Manager at Frost & Sullivan.

“Today already, 40 million people use app-enabled carpooling services, and the usage of ride-hailing apps has grown rapidly to over 70 million users.”

Autonomous cars account for US$84 billion market by 2030

Different transportation modes are expanding the transportation industry. Public and private transport is decreasing because of multi-modal integrated transportation systems inspiring the emergence of models, such as multi solutions, smart ticketing and aggregated booking.

“Autonomous cars only will account for a US$84 billion market by 2030,” says Franck Leveque, Frost & Sullivan’s Business Leader.

“50% of these US$84 billion will be software related, which exemplifies perfectly how the mobility sector converges with other industries. Similar trends can be observed for retailing. By 2020, the retail store footprint will be 15-20% less than the current average store size and future garages will incorporate technology at various levels. The goal is an engaging digital experience to increase customer loyalty.”

Written from press release by Leah Alger