How IoT Is Transforming Car Companies
As per Business Insider (BI) report, 381 million connected cars will be on the road by 2020, up from 36 million in 2015. Furthermore, BI Intelligence forecasts that connected cars will generate $8.1 trillion between 2015 and 2020. These figures indicate that IoT and related digitalization technologies will lead to a fundamental shift in the world of mobility.
According to a 2016 Gartner report, the production of new automobiles equipped with data connectivity, either through a built-in communications module or by a tether to a mobile device, is forecast to reach 12.4 million in 2016 and increase to 61 million in 2020.
Indeed, the auto industry is on the brink of a revolution, and the driving force is the suite of technologies known as the Internet of Things (IoT)
The ultimate expression of a car that drives itself is being developed through IoT. Such a car would be 10% hardware and 90% software, and it would be connected to everything – connection is made from vehicle to vehicle, vehicle to cloud and vehicle to drive. Cars would be connected without the direct involvement of the driver, through the help of software that is still in the process of being perfected.
Source: DUpress.com (Deloitte)
Cars and automobiles at large will record a huge volume of streaming data- Big Data which needs to be stored and analyzed in real time. This data will not just be beneficial for the auto manufacturers (to understand how their cars are used) but also by insurance companies (driving behavior will correlate with premium) but also for Governments, Municipal authorities and specifical authorities in smart cities.
The future may allow us to witness the following :
- Auto companies buying or partnering with Tech companies
- Companies like Apple producing Cars
- Transport as a service making ownership of cars redundant but allowing car manufacturers to earn from other mediums (like advertising, subscriptions etc.)
- The value system of cars will change. (Just like smartphones deliver more value than just voice calling today, imagine how connected and app fitted cars can deliver value tomorrow)