What do consumers want from the car of the future?

Stakeholders explore how the industry can best adapt to changing customer requirements. By Megan Lampinen

Automotive industry product cycle times are growing shorter, but they are still long compared to other industries. That means companies need to start thinking today about what the customer will want several years down the line. The rapid development and spread of CASE (connected, autonomous, shared and electric) technologies makes that prediction process even more challenging.

But it’s not impossible. The key is to home in on the main themes in customer expectations. These expectations, and the various customer bases from which they spring, were some of the key topics explored by industry stakeholders at the recent M:bility | Europe event in Stuttgart.

“In the end, transport is about getting from A to B safely and reliably,” observed Jens Haas, Managing Director, Munich at AlixPartners. “That’s a given and will continue to be a given. However, there is growing relevance in different aspects.”


The arrival of CASE is starting to challenge the traditional feature of the auto industry. Questions around the vehicle’s performance—‘is it fun to drive?’—are being replaced by questions around ownership—‘do we really need to own a car at all?’ As Haas explained: “When it comes to getting and using mobility, consumers are becoming more impatient and want instant availability. At the same time, they want more flexibility, individuality and personalisation.”

We need to convert from the outlook that rewards salespeople for pushing sales to giving people a sense of experience

Convenience and productivity benefits are driving growing connectivity and the rise of automation, but at the same time, these trends are prompting new concerns around cyber crime, the loss of privacy and misuse of data. “We are seeing the emergence of different degrees of driving on the autonomous spectrum,” observed Morgan Holt, Chief Strategy Officer, Fitch. Eventually, he suggests, there will be a complete shift from driver to rider as the car takes over more driving tasks. This could mean a whole new set of consumer priorities.

At the same time, the rise of electrification has many shoppers questioning range capabilities and charging infrastructure. But with electric vehicles (EVs) the levels of concern, and interest, vary widely. A recent survey from AlixPartners found that nearly 50% of respondents in China were considering an EV for their next purchase. Interest levels in most of the other regions polled was about 25%, which though half of China’s level is still notable. “The purchase plans revealed in the survey are completely mismatched with the market share of EVs we see today, and with what’s expected over the next few years,” said Haas. Notably, the willingness to pay a premium for EVs is relatively limited, with China showing the greatest level of willingness.

There are a number of steps that industry players can do to generate greater consumer trust in CASE solutions. In almost every instance, improved familiarity with the technology is expected to go far. “The industry needs to talk more about EVs and AVs,” said Holt. They can do this both at the dealership and via an online presence. Consumers are increasingly using the Internet in their shopping journey, particularly for initial research, offering more touchpoints for brands to reach out. “With the whole omni-channel experience, automakers can become more involved in this,” he added.

Benjamin Moncrieffe, Head of Auto+ at ‘customer-focussed’ consultancy C Space, anticipates an evolution of the traditional car dealership away from sales towards experience. A great deal of brands are experimenting with experience centres, many of which aim to educate consumers about the brand in a no-pressure environment. “There is great potential to look at automotive retail from an experiential angle,” he suggested. “I think we need to convert from the outlook that rewards salespeople for pushing sales to giving people a sense of experience, allowing them to trial a product and build familiarity.”

Co-create with customers

One of the most important actions that stakeholders can take to meet the changing demands of consumers is to work with them collaboratively. Moncrieffe suggested that automakers and mobility providers alike treat their customers as consultants and work with them to jointly develop solutions. “By designing together, rather than assuming you know the future, you de-risk your strategy,” he pointed out.

Once consumers are familiar with connected services, they generally like them. And once they use them they are more likely to buy them again

Robert Schroeder, Deputy Managing Director for Kantar TNS’s automotive business in Germany, seconded the suggestion, emphasising that this is the strategy that his team deploys. “Automakers need to avoid disappointments and misunderstandings,” he stated. Kantar studies have uncovered some concerning disconnects in what car owners and automakers expect. “While today’s car is connected, the consumer is disconnected,” Schroeder asserted.

For example, many respondents in Kantar’s survey did not even know they had certain connected features in their vehicle, and therefore weren’t using them. Part of the problem is linked to the handover, during which the salesperson does not always fully explain the potential of the vehicle. Automakers and retailers need to address this, and quickly. Schroeder suggested that retailers encourage new owners to return to the dealership after a week or two, during which time they can explain what features they have been using and discover which ones they may have overlooked. “Once consumers are familiar with connected services, they generally like them. And once they use them they are more likely to buy them again,” he added.

Retail and the customer relationship

Above all, automakers will want to preserve their relationship with the consumer moving forward. “I know the automakers are worried they will lose the interaction with the customer,” said Moncrieffe. “It is too big an opportunity to miss.”

That relationship may not be easy to maintain in this evolving ecosystem where services could dominate product, and may require creative approaches. “There is huge potential for automakers to deconstruct the features that the car offers and to create services that can be marketed and sold,” said Schroeder. “They can charge prices for these services based on their value.”

There is huge potential for automakers to deconstruct the features that the car offers and to create services that can be marketed and sold

As Holt pointed out, automakers need to think about exactly what it is they will be selling—a product, a service or a combination of both. “We have seen plenty of tinkering around the edges with new partnerships,” he said. “The industry is entering a relatively unusual time where there are three competitive groupings all jostling for the same space.” There are the automakers, whose primary agenda is to sell a product, along with the tech companies and the mobility providers. While numerous new partnerships are springing up among these groups, Holt urged caution: “Automakers need to be cautious about partnering up with these players. The tech companies tend to see hardware as another platform. They see the car as just another device. Their agenda is very different.”

A sense of freedom

Despite the many changes emerging, Schroeder believes the car itself will remain at the centre of the mobility revolution. “The good news for automakers is that the car is highly appreciated now and will remain so in the future,” he said. “People are telling us they like the freedom and independence of using vehicles as and when they want. The alternatives available today and in the coming decades, in the form of public transport, will not make them switch from car usage to public transport usage.” Because of this trend, Schroeder believes automakers are likely to have “a major impact on the solutions of the future.”

Moncrieffe suggested that many consumers today feel constricted in the way they currently travel. “Freedom is a very lofty ambition and a desirable thing to want from a car,” he commented. “The idea that technology, particularly automation, electrification and shared mobility, will create a sense of freedom is a huge paradigm shift. However, there is the danger that consumers may come to see it as a utopia.”

Fitch’s Holt agreed with this concern, but highlighted a potential generational difference: “There is a danger that we see freedom through the lens of a car. For most of us, from my generation, getting a driving license was a rite of passage. But freedom for many younger people is not necessarily unlocked by driving a car.” The challenge now is to figure out exactly how to provide this sense of freedom for everyone—whether that be a 60-year-old farmer in the US or a young professional in Beijing—in a profitable and sustainable way.

This article appeared in the Q4 2019 issue of M:bility | Magazine. Follow this link to download the full issue.

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