Nine trends shaping the mobility industry

7th February 2023

Nine trends shaping the mobility industry

Global supply chain disruption due to macroeconomic shocks such as the pandemic and a significant squeeze on consumer income, combined with the rise of new technologies, business models and buying behaviours have created a volatile environment for business.

1) Global supply chain uncertainty

The post-pandemic world is still reeling from chip shortages, supply chain issues and geopolitical instability – UK production dropped to a 66 year low in 2022 (BBC).

2) Volatility of used car values impacting depreciation

Used car values and new car depreciation are continuously fluctuating  in a market filled with supply shocks and the rising popularity of electric cars. Used car prices rose ~40% in 2022 (JP Morgan) and a huge fall is expected in 23, breaking current assumptions on relationships between new and used car pricing.

3) Cost of finance & squeeze on consumer income

Consumer affordability and real incomes have never been more significant. Over 2022 the UK Consumer Price Index rose by 10.5% (ONS). The cost of borrowing increased across several global economies making financing new sales costly.

4) EV transition product mix

Managing customer choice of petrol/diesel cars versus plug-in hybrids and full electric cars is important as customers, the market and infrastructure play catch-up to transition to the future. Different speeds of adoption across global markets will present interesting arbitrage opportunities.

5) Shift from vehicle ownership to subscription models

The rise of all-in-one subscription models and short term leases is transforming customer attitudes from ownership to subscription. OEMs selling D2C, retailers becoming fleet owners and their convergence with vehicle rentals are interesting trends to watch out for.

6) Delivering seamless omni-channel customer experience

As new business models emerge and traditional roles in the value chain change, customer relationships will also transform. Their digital footprint will enable a personalised sales journey from informed attraction all the way through to conversion, retention, and developing advocacy.

7) Emergence of ‘connected cars’

As cars become smarter and connected, carmakers have an opportunity to extend their services on-road through charging, over-the-air through upgrades and deliver a different experience journey through new business models.

8) Emergence of software and digital as critical capabilities

Where powertrain engineers previously ruled the roost, the next decade belongs to software and data/ML engineers. Carmakers of the future will need to bridge this capability gap to tap into opportunities for innovative new products and services and compete with new & nimbler players.

9) Fleet decarbonisation strategy

Fleet owners are rapidly de-carbonising their footprints. Finding the right mix of ICE / Hybrid / EVs to optimise sales, operational effectiveness and total cost of ownership will be critical.

New paradigms require doing things differently to succeed. Data science and AI can turn these challenges into game-changing opportunities…

Click here to find out how the industry is reacting.

Contact us