Mobility Strikes Back – Top 10 Trending Topics

The EPM Advisory Council, an automotive industry consortium comprised of executives that are studying all aspects of mobility and customer experiences, met toward the end of 2022 to discuss the top 10 industry trends impacting the mobility experience in 2022. Also, they discussed how those trends were likely to continue in 2023 based on market conditions. This blog post summarizes thoughts that emerged for the top 10 trending topics influencing experience in 2023.

Once thought to be on the brink of extinction with the creation of the shared mobility segment, personal automobile ownership has taken a sharp positive turn. EVs, software-defined vehicles (SDVs), autonomous vehicles and more have reignited the category.

Innovation is the name of the game and it’s in that spirit that the EPM Advisory Council recently convened to discuss the most compelling trending topics in the automotive space. Let’s take a look at the new trends and how they will evolve over time.

1. Inventory to Improve

Due to the pandemic, supply chain issues and the microchip shortage, the consumer has been faced with a new normal of empty dealer lots and escalating prices. Consumers have been forced to pay more for new and used cars, delay purchases or consider alternatives like ridesharing. As the microchip shortage eases, production, inventory and pricing will continue to improve and offer consumers more options.

In an effort to reduce reliance on Chinese-made semiconductor chips, the United States government has committed to investing in semiconductor companies to expand domestic manufacturing. A $52 billion executive order is intended to entice hardware companies back to the US with a 25% tax credit for companies investing in US semiconductor manufacturing.

OEMs will also look to build closer relationships with custom chip makers and work together on solutions. Manufacturers will move from an arm’s-length relationship to long-term agreements and even risk sharing. They’ll also engage multiple suppliers to mitigate supply chain issues moving forward.

2. Sharing Spaces

The supply challenges this past year as well as changing consumer preferences have driven the demand for shared mobility. Riders are facing widespread driver shortages and sky-high prices, especially in big cities.

As consumers continue to seek flexibility to choose the best solution for a specific purpose, entirely new segments of specialized vehicles will follow. McKinsey projects that up to one out of ten cars sold in 2030 may be a shared vehicle, designed for heavy use, additional mileage and comfort.

3. Alexa vs. Afeela – The New Battlefield

As consumer demand for connected services, autonomous vehicles, shared mobility and electrification technologies (CASE) increases, traditional car manufacturers must compete with new entrants globally. Consider Amazon’s latest technology that allows drivers to use Alexa to find EV charging locations and initiate a charge with EVgo.

Not to be outdone, Honda and Sony have joined forces to create Afeela, a new electric car brand that promises to combine Honda’s automotive expertise with Sony’s experience in AI, entertainment, VR and AR. With Afeela, passengers will experience the sensation of interactive mobility where it detects and understands their needs through sensing and AI technologies.

4. Game On

Entertainment has moved to the front seat as cockpit domain controllers give drivers a seamless and immersive experience from music to navigation and communication. With this change, OEMs can now take the gaming experience on the road to offer more entertainment solutions to all passengers or during EV charging.

In-vehicle gaming applications were a major theme at CES. Hyundai Motor Group, Polestar and BYD announced that they will be offering NVIDIA’s cloud-based gaming service in select new models. Cadillac will include in-vehicle gaming in their Lyriq model while Volkswagen’s CARIAD shared their vision to bring streaming games to market.

5. EVs Everywhere

It’s no surprise that EVs stole the show at CES. According to a PwC report, EV adoption rates in the US will rise from 2% now to 44% by 2035, with China and EU markets surging even more. Many factors are driving demand – from rising fuel costs to concerns about carbon emissions.

As consumers want to feel good about their purchase and their footprint, local municipalities are taking it one step further by creating a regulatory path to zeroemission vehicles. California plans to ban sales of new gas cars by 2035 and several other states have established mandates to reduce gas-powered vehicles in favor of EVs by the 2030s.

Federal tax credits on EV purchases are designed to further incentivize category growth. US consumers who purchase a used EV qualify for up to a $4,000 credit while those who buy a new plug-in EV or fuel cell electric vehicle qualify for up to a $7,500 credit.

This all comes as Chinese OEMs aggressively enter Europe with mid-price EV brands. The country exported $3.2 billion of EVs in November of 2022, up 165% from previous year, to the highest-ever monthly total. Chinese brands in the US may be rare at the moment but the wave is expected to reach it soon.

6. Updates Made Easy

Tesla may be best well-known for the concept of the updatable vehicle, but major automakers are all participating in this next evolution of the automotive industry. Consumers expect the car to be an extension of their digital life and smartphone – and SDVs offer that customizable experience.

With differentiation now driven by software, OEMs are embracing cloud-native computing to enable fast deployment of updates and new features and functions. From Qualcomm to Garmin, high-tech entrants were all over the show floor at CES displaying their considerable investment in the space.

HARMAN’s Ready Upgrade allows drivers to add and upgrade vehicle features as easily as they would with their smartphones. Meanwhile, BlackBerry’s IVY in-vehicle software platform uses cloud-controlled access to vehicle data to predict maintenance and offer in-vehicle secure payments with Alexa.

7. Consumers Want Control

Autonomous pilots have popped up in markets across the country from Zoox (Amazonacquired start-up) in the Bay Area, Seattle and Las Vegas, to Waymo’s fee-charging driverless robotaxis in Phoenix. While much has been written about the future of fully autonomous driving, we anticipate this year to be more practically focused on lower levels of autonomy, requiring drivers to stay in control while allowing the vehicle to handle steering, acceleration and braking.

Mercedes-Benz plans to unveil their SAE L2 Automatic Lane Change Feature as well as an SAE L3 DRIVE PILOT system in Nevada and California this year. Safety will continue to be a significant concern as many consumers feel autonomous vehicles cannot fully simulate human response, especially if something goes wrong on the road.
CES suppliers emphasized their lidar innovations to help vehicles “see” their surroundings which will become more commonplace in the years to come.

OTA software updates will also play a critical role in autonomous driving. There must be strict control over user access to ensure vehicles are not “highjacked” from the outside. Cyber security is critical as the damage that could be caused by malicious actors is enormous.

8. The Living Room Becomes a Moving Room

With so much time spent on the road, drivers want a living room experience in the car. Design is king and consumers demand slim displays with full HD and brilliant color.

The entire windshield becomes the HUD in BMW’s I Vision Dee, which stands for Digital Emotional Experience. The vehicle showcases what’s possible when hardware and software merge – transforming the car into an intelligent companion.

Apple has major plans to take over every screen in the car. The vision is to deeply integrate CarPlay allowing it to display information across multiple screens in the car. A connected iPhone will communicate and integrate with the vehicle in real time. As an example, a new CarPlay feature will allow users to tap an app to navigate to a pump and buy gas straight from an in-vehicle screen.

The car exterior now also becomes a screen with displays showing everything from weather to sports. The opportunities for advertising personalization and monetization are significant. Providers who can bring it all together in a moving vehicle are poised to reap big rewards.

9. Swipe, Click, Buy

From Metaverse showrooms to trade valuations and digital contracts, digital retail delivers the connected, convenient car-buying experience that consumers demand. We expect to see even more of this with the EV car-buying experience.

A recent industry study notes that up to two-thirds of all car buyers use digital automotive retail channels to search for their next vehicle purchase compared to 71% of all EV buyers. In fact, 87% of new EV buyers are open to buying fully online according to Cox Automotive – with two out of three open to purchasing/leasing from a dealer website.

That said, in-person interaction will always play a role in the buying decision. Consumers need to experience the product and try before they buy. Brick and mortar showrooms are stepping up their game to connect the physical and the digital worlds. Success for both OEMs and dealers will require the cultivation of a seamless, integrated customer journey.

10. Green Matters

From batteries to tires, the global automotive industry is keenly focused on reducing its impact on the environment to address consumer concern. Manufacturers and suppliers are accelerating their sustainability practices and product development.

Goodyear is pushing forward with a BetterFuture tire made of 90% sustainable materials including plant-based component and recycled polyester. AWS unveiled a sustainability intelligence portal at CES that uses emissions data to help companies optimize their supply chains from mining to reuse and recycle.

We will need to continue to address the challenges and opportunities of a sustainable value chain including traceability throughout the lifecycle of EV batteries. The millions of lithium-ion batteries that power EVs will be tracked and traced through technologies like IoT and blockchain.

The Future Looks Bright

We may not be ready for flying cars to be mainstream just yet – although we’re starting to see them at high-tech shows – but it’s still a fascinating time to be in automotive. The digital future is here and OEMs who embrace technology, electrification and connectivity will win.

About The Experiences Per Mile Advisory Council

The Experiences Per Mile Advisory Council, led by HARMAN Automotive, SBD Automotive, HERE Technologies and Cox Automotive is comprised of industry executives that are studying all aspects of mobility and customer experiences. This blog was written by summarizing thoughts from members during an ideation session about Top Mobility Trends in 2022. By fueling cross-industry collaboration and driving toward the same consumer experience objectives, we can advance the connected automotive industry and introduce meaningful technology and innovation. Interested in this topic? Register to get involved today.