MegaTrends shed light on how different industries are collaborating together to shape a new future society. Read MegaTrends to gain a glimpse as to what products or services will become standards in the near future.
Autonomous Driving Capabilities
In-Vehicle Infotainment (IVI)
The next megatrend in the automotive industry is the Smart Car, also known as automated guided vehicles (AGV) or vehicles that are equipped with advanced electronics. With the growing demand for the internet of things (IoT), the younger generations enjoy having the same services in their vehicles as they can get their home, office or smartphone. Demand for features such as navigation and speech recognition rose in its ratings to 38% in 2014 from 20% in 2013 (Daiwa Securities, 2015).
In 2012, according to Daiwa Securities, only 6% of auto sales were from vehicles that were smartphone-integrated, 7% with embedded technology and 87% all other non-technology vehicles. By 2018, it is estimated that 26% of auto sales will be from vehicles that are smartphone-integrated, 31% from vehicles with embedded technology and only 43% from all other non-technology vehicles.
In order for vehicle manufacturers to continue with technology integration, they must collaborate with key players in the technology industry. Therefore, since the mid 2000s, major collaborations have demonstrated great strides in the development towards smarter cars. Some examples of these collaborations include Ford – Microsoft, BMW – Intel, and Toyota – Microsoft – Intel among others.
Globally, there has been growth in regulation to support research, development and commercialization of this technology. For example, the European Union, in 2012, established a panel with the goal of beginning Smart Car commercial production by 2025. In 2013, both the United States and Japan established programs for research, testing, and operating Smart Cars on public roads. The Olympic games in Tokyo in 2020 intends to be a showcase for autonomous driving.
Daiwa Securities assessed, that for this market to grow, the corresponding markets must expand also such as automotive electronics parts and semiconductors. The growth in this industry is being driven in large part by the following ‘mega-trends’:
This trend involves the ability for vehicles to communicate with each other as well as traffic infrastructure such as toll plazas and traffic signals. The main feature is the ability to communicate with other vehicles for crash avoidance. Using on-board sensors, the vehicles can process the data and turn into applicable information such as driving too close, navigation advice, and speed.
This trend is the convergence of telecommunications and information processing that leads to features such as GPS navigation, automation, emergency warning systems as well as diagnostics and prognostics of vehicle health. This is another example of cross-industry collaboration that has become required for advancement in this area.
The megatrend with the greatest potential, according to Daiwa Securities, is autonomous driving and is representative of the true Smart Car. Examples of this mega trend include cruise control, lane detection/departure, forward sensing, auto-parking, collision avoidance and self-driving assistance. The major players in this global arena include Bosch, Continental, Autoliv, TRW and Denso.
This feature combines both entertainment and information into vehicle features to enhance the driver and passenger experience with features such as in-vehicle web browsing, media, entertainment and communication.
Car manufacturers have begun to integrate these features in the vehicle since the mid-2000s. For example, Nissan integrated a Microsoft Xbox 360 game console in 2005. That year, Chrysler introduced a feature to control an iPod using the auto’s main control system. In 2010, Ford launched the SYNC system for hands free calls and the activation of mobile-based apps using the driver’s voice.
It is evident that the future of Smart Cars is certain as a result of rapid demand for and rapid development of vehicle technology that mimic the features of a computer or smartphone. Regulatory allowances will make commercialization easier and beneficial to society overall with the intent on reducing driving-related injuries and fatalities.
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