Data changing the automakers’ game
Big data generated by connected vehicles offer big opportunities.
However, industry executives say there is still much work to be done before the 1’s and 0’s are transformed into bigger numbers on the bottom line. As more sensors are enabled on vehicles and mobility infrastructure to capture where, when, and how autos are driven and function, the data will continue growing exponentially. The thinking goes that monetization eventually will greatly increase as well.
In fact, McKinsey research forecasts total global revenue from car data monetization may reach from $450Bn to $750Bn by 2030. In a report, McKinsey predicts winners in this industry will be companies that “provide new features and services ranging from connected infotainment to remote vehicle diagnostics, from emergency breakdown automated calling to tailored advertising in the car. For industry players, three value-creation models underlie these use cases: revenue generation, cost reduction, and enhancement of safety and security”.
Yet, the research asserts that companies in the automotive data business “have yet to capture fully the value of this data onslaught”. McKinsey calls this the “car data monetization gap”, which represents the difference between the potential value of data and the actual revenue or savings generated by the information.
Clearly the gauntlet has been laid down for mobility companies to bridge this monetization gap efficiently and effectively before it widens. That’s because on-board data is growing exponentially, transforming connected vehicles into “data centers on wheels”, according to Francois Fleutiaux, chief commercial officer, T-Systems.
In a blog post, he wrote: “Modern vehicles generate some 25 gigabytes of data every hour but autonomous cars will create up to 3,600 gigabytes of data per hour, according to expert forecasts.” Fleutiaux points out that data is not only generated while a vehicle is on the road, but “originates along the entire value chain, from design and development, through production, sales and use, to maintenance and repairs, all by itself”.
Stream data and chill
Carl Esposito, senior vice-president and president, E-Systems, Lear, told TU-Automotive in an interview: “The challenges automakers are facing include where to start and how to organize because the opportunities are very broad and cross-functional. Data collection and transmission capabilities are already built into many vehicles. The next steps are taking advantage of those capabilities and making better use of the information to improve products and the in-vehicle experience for consumers and continue to develop software-defined cars and trucks.”
To read the complete article, visit TU-Automotive.