By Sven Patuschka, CTO, TMPV and TPEM
Connected cars offer the promise of enhanced safety, more efficiency, and of course, much greater
convenience for drivers. A connected car ecosystem can potentially reduce accidents, improve traffic
flow, and enable an efficient transportation ecosystem.
As consumers continue to seek faster service with ease of usage, internet connectivity, especially via mobile devices are further fueling the demand of connected cars. According to GSMA’s The State of Mobile Internet Connectivity Report 2023, the global mobile internet coverage gap has reduced from 18% in 2015 to 5% in 2022, while the share of connected people has risen from 35% to 57% in the same period.
As more people get access to the internet, they are also seeking connected products and services. This augurs well for the automotive industry which is witnessing promising growth for connected vehicles. Connected vehicles, simply put, are vehicles that are equipped with an internet connection, thereby enabling connections with similar internet-enabled devices or the Internet of Things (IoT). They can enable features like remote operation of vehicles and security functions.
The promise of connection
The growth of the connected vehicles market is closely tied with the growth of mobile internet technologies such as 3G, 4G, and 5G. As 5G continues to replace older technologies, it will facilitate the global connected vehicle market, which is expected to grow at a compounded annual growth rate (CAGR) of 18.6% between 2022 and 2032, to touch $331.9 billion by 2032.
The emerging technologies coupled with the growing focus on user experience are fueling the evolution of innovative operational models such as ‘Mobility as a service’ that promise personalized access to multiple transport modes and services based on need. Asia Pacific, and more specifically India, is set to lead this growth for connected vehicles, with India set to grow faster than the global markets at a CAGR of 21%.
India’s potential as a connectivity leader
Reports suggest that more than two-thirds of customers in India are willing to pay extra for connectivity features, the highest share among leading markets. The efforts made by the Indian government towards
improving the digital infrastructure of the country are also bolstering this trend. The Indian government’s efforts such as Pan India digital currency deployment, broadband for rural as well as urban infrastructure, and better mobile connectivity across the country are already smoothening the road for the connected vehicles market.
These initiatives have played a crucial role in narrowing India’s technology adoption gap. Thanks to these advancements, more people in India are now able to access digital services and reap the benefits of a digitally connected world. The rapidly evolving Indian consumer with an enhanced willingness to pay for value-added services has also worked in favour of the connected vehicles market. Driving this consumer shift is India’s Gen Z, which forms almost 25% of the country’s population. The Indian Gen Z is also leading the way for global markets due to their willingness to switch to new vehicles with connected features and purchase subscription packages by giving up vehicle ownership.
Course correction
While the potential for connected vehicles is huge in India, there is a need to adopt appropriate strategies and course corrections to ensure the automotive industry makes the most of this potential. This calls for each Manufacturer to define the guiding elements which would govern their product and service offerings. Tata Motors, for example, has identified three key aspects – safety, user experience, and integration of health and wellness into customers digital experience – that would define our Connected Vehicle offerings. The focus should not be on merely adding a high number of features, but rather on quality integration of connectivity along with an educative user manual approach.
For instance, the growth of wearable devices is a testament to how customers appreciate products and services that uphold their health and wellness. Similarly, the Indian customer is also willing to pay more for personalised features along with the comfort and convenience that connected vehicles offer. This includes features such as customised driver profiles, features-on-demand, in-vehicle payments and predictive maintenance, to name a few.
The industry must ensure that the various features and technologies being offered work seamlessly together, providing a cohesive and intuitive experience for the user. By prioritising safety, user experience, and quality integration of connectivity, the automotive industry can create a truly innovative and effectively connected vehicle strategy.
The road ahead
Modern-day automobiles are no longer just machines that take customers from one place to another. With the rapid advancements in technology, today’s vehicles have become intelligent network entities that are equipped with a plethora of advanced features.
The automotive industry could do well to upgrade these vehicles with ‘intelligence’ by enabling them to
connect to the internet, share data, and communicate with other vehicles, making them an integral part
of the connected world. The digital revolution is driving a shift in the way automobiles are perceived and
used, giving rise to a host of new possibilities and opportunities. Development and continuous deployment of new user experiences would be the key, and this would be possible through defining the user experiences through software (So called SDV way). A well architected connected platform would be the most important technology element to build SDV (Software Defined Vehicles).
This transformation impacts various aspects of the automotive landscape, including design, manufacturing, marketing, and customer experience. The road ahead would be to focus on collaboration with connected ecosystem partners to build the future of connected mobility and successfully strategize to meet intelligent customer demands.
