With its origin in the gaming industry, the Metaverse describes the convergence of several developments, all of which involve step changes in technological capabilities: Mass-market ready devices for augmented, virtual and mixed reality, Metaverse-worlds with hundreds of million active users and virtual assets powered by Web3 technologies.
This convergence creates an immersive sphere where the boundaries between virtual and physical world blur. A space where people and organisations can interact and fully immerse themselves with digital content in three dimensions—a far cry from the online experiences to which we are accustomed now.
Big money is already moving into this space. The virtual asset economy (in the form of non-fungible token (NFT) has surpassed US$400m in investments in only a few months. The global Metaverse market size is expected to reach US$250bn to US$400bn by 2025, according to BCG’s recent report: The Corporate Hitchhiker’s Guide to the Metaverse. Over the projected timeframe, the market is estimated to expand at a CAGR of ~40% because of the rising demand from sectors such as media, entertainment, and education.
The Metaverse will impact automotive companies on all levels of their value chain, with deeper and more immersive customer engagements, closer integration, and seamless collaboration with suppliers, partners, and internally
The possibilities of the Metaverse are also being explored by several car manufacturers. Interactive holographic windscreens and 3D virtual stores are just the beginning. But while this allows for better information and customer experience, what does the Metaverse really mean for the automotive industry?
The Metaverse will impact automotive companies on all levels of their value chain, with deeper and more immersive customer engagements, closer integration, and seamless collaboration with suppliers, partners, and internally. This will lead to shorter development cycles, higher quality, and improved market fit.
Are the days of a real-life showroom almost over? Not necessarily, but we can be certain that designing, manufacturing, and buying a car will look very different in the Metaverse.
Many of the technologies have been in place for several years and have enabled such things as digital twins in product development, predictive maintenance, and virtual planning. What is new is the level of connectedness and virtual maturity throughout the enterprise. To give an example: applying the Metaverse technologies to product development will allow us to fundamentally rethink how we engineer cars in the future. Ultimately, we will build hardware in the way we build software today. That means a product portfolio without fixed product cycles designed for updates, continuous development and integration of new technologies and product updates.
The described use case is just the tip of the iceberg: strategy coherence, stringent execution and building up internal competencies will be crucial to win in this new market. The Metaverse is here to stay, and early adopters will have the advantage of capitalising on opportunities as soon as they arise.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
Kathrin Pannier is Managing Director & Partner at BCG
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