If the future of mobility was not uncertain before, it certainly is now. The novel coronavirus (COVID-19) has changed everything, from travel habits, to vehicle purchase plans, and even the way we consume mobility. With the pandemic likely to present a threat for months if not years to come, public transport and shared mobility options become less desirable, whilst options that limit contact become more attractive.
These come at a time when the automotive industry, keen to secure its future in shared mobility and connected services, was building new competencies in the domain of technology and digitalisation. This remains an intimidating prospect for automotive industry giants: not traditionally versed in the finer points of software, AI, cryptocurrency and other technology trends, they are suddenly confronted with an open field, filled with players and potential partners.
“Car companies are no longer dealing simply in mechanics”, says Jeffrey Tiong, Founder and Chief Executive of innovation intelligence provider PatSnap. “The convergence of technology requires brand new capabilities, and to build these up, stakeholders need to know who is leading the way. For example, who is the best AI software developer who can work with LiDAR detection? Or who can produce the best lithium-ion battery for this application?”
PatSnap’s platform aims to help in this regard by mapping the tech sector’s many players and detailing their investors, owners and cited intellectual property. It is a comprehensive and continually updated intelligence platform detailing the who’s-who across fields relevant to the megatrends now dominating the automotive space: connectivity, autonomy, shared mobility and electrification (CASE).
“Let’s say a mobility company wants to enter a new space,” says Tiong. “With our platform, it can determine whether it has the freedom to do so. For example, whether it can develop a new product without infringing on someone else’s patents. In addition, companies can identify potential partners to co-operate with on new technology, whether that’s a start-up, a university lab, or something else.” Tiong calls it ‘connected innovation intelligence’, and argues that in the age of the pandemic, it could prove more vital for the automotive industry than ever before. Those companies with the right tools are better positioned to identify the technological opportunities that could affect the growth and survival of the sector.
Weathering the crisis
Tiong calls the COVID-19 pandemic a ‘black swan’ event: a rare and hard-to-predict occurrence that has made a major impact, the long-term effects of which are difficult to forecast. “It’s a once in a century thing,” he says. “Many of our customers are based in China, the first nation to be hit by COVID-19, and while in some respects they are returning to normal, conversations with our automotive customers suggest the impact has been huge.”
The automotive industry is changing such that an automaker’s biggest competitor is no longer another GM, or another another VW: it’s Google, or Apple
Among PatSnap’s customers are electric vehicle (EV) technology developers, autonomous vehicle (AV) developers and more. “Production lines were affected, and the supply and distribution of essential parts was disrupted. Wuhan is an important hub for parts production, and so while on paper some companies have returned to work, there are still big difficulties.” Part of the reason for this is the patchwork of restrictions across China, with certain parts of the country still enforcing some limitations.
Among other things, he adds, COVID-19 has made the return of production into the local supply chain a priority for some. With many markets experiencing the chaos of COVID-19 at different rates and over different timeframes, international supply chains have been thrown into chaos. Bringing local supply chains back online is far easier to co-ordinate, points out Tiong, and he sees a role for offerings like PatSnap in restructuring these supply chains in a post-COVID world. With second waves of the disease expected, and the threat of pandemics now better understood, the industry will be looking to protect itself from future occurrences as much as possible.
In addition, PatSnap’s data shows that venture capital investment, on which many start-ups and companies in the future mobility space rely, has dropped with the onset of the crisis. But importantly, says Tiong, the drop has been relatively small compared with some other industries.
Many of our customers are based in China, the first nation to be hit by COVID-19, and while in some respects they are returning to normal, conversations with our automotive customers suggest the impact has been huge
“Investors still see a space for the autonomous vehicle,” he suggests. This backs one narrative that predicts an acceleration for AV development, particularly when it comes to goods and delivery. Several services and trials are already on the streets of cities worldwide, from developers including Pony.AI, Yandex and Nuro.
COVID-19 will eventually pass. What will not change is the fact that the automotive industry is going through a greatly transformative time. “The automotive industry is changing such that an automaker’s biggest competitor is no longer another GM, or another another VW: it’s Google, or Apple,” he says. COVID-19 is creating great uncertainty, and business leaders will move to cut costs wherever possible, but right now the automotive industry cannot afford to let up on innovation if it hopes to compete effectively.
As such, Tiong views insight and analysis on tech companies, R&D and their patents as more essential than ever. With money tight, automakers will have limited opportunity to get things right when picking who they work with and what they develop. Connected innovation intelligence, concludes Tiong, will allow mobility companies to put their eggs in fewer baskets, and retain a competitive edge at a time of great belt-tightening.