The Future of Automotive Manufacturing is Now
As the world undergoes drastic changes, so does technological innovation. We often wonder what the future will look like with the advancement of technology—but what we fail to realize is that the future of automotive industry manufacturing is already here.
While no one would have guessed that a pandemic would emerge so suddenly, the aftermath that we are still experiencing from it has caused a shift in every aspect of our daily lives. Like many industries, the automotive industry has also been affected by the COVID-19 pandemic. As we saw plant closures in the United States, layoffs, and interruptions with car parts exports across countries, the question industry players often found themselves asking was not if, but rather when we would undergo a recession.
Despite the repercussions that the pandemic presented to the auto industry, developments have accelerated in a way that’s brimming with potential for a change in our new automotive world.
How is the Global Automotive Market Changing?
With technology at the forefront of the changes we can expect from the automotive industry, it’s safe to assume that the future trends of car manufacturing will be more advanced than we can currently comprehend. So for the future of automotive industry manufacturing, what awaits us within the following years?
Increasing Prevalence of Electric Vehicles
Environmentally sustainable vehicles are the future. There’s no doubt about that, and while we continue to see a growing demand for electric vehicles, automotive players will continue to cater to what consumers are purchasing. Companies have already introduced electric car models—some for affordable prices, opening the possibility of a future where sustainable cars are the preferred automobile model for consumers.
Just recently, Ford announced its new all-electric pickup truck set to be released in 2022, the Ford F-150 Lightning. Ford is also working on developing electric versions of its Explorer and Lincoln Aviator SUVs with hopes of having 40% of its global fleet completely electric by 2030.
With further car feature improvements and an increase in the capacity of lithium-ion batteries, there is a high chance that we will see a rise in sales of electric vehicles.
Advancements in Artificial Intelligence & Autonomous Vehicles
Though the idea of autonomous vehicles and artificial intelligence dominating the world was once seen as a work of science-fiction, this may very well be our reality sooner than we realize. The idea of autonomous vehicles being a normal part of our everyday lives might be a strange concept to grasp, but the truth is, they are already starting to make their way into the mainstream world with the help of tech giants and auto companies.
However, there is still much more to be done. Although technology has been integrated into vehicles for decades, it has never been done at such an advanced and rapidly expanding level. Expanding manufacturing and supply chain capabilities, as well as the overall infrastructures is necessary to make the world of autonomous driving our next reality.
Increasing Demand for Ride-Sharing/Hailing Services
As hailing services, such as Uber and Lyft, attract investors and see impressive returns, automotive manufacturers are creating their own ride-sharing services. Auto companies, such as Volkswagen, recently announced their own all-electric hailing service in Germany called WE.
Volkswagen plans to expand this service to major cities in Europe, North America, and Asia, providing zero-emission, sustainable mobility. Ride-sharing has many benefits that not only decrease traffic and congestion in cities, but it also decreases emissions as the number of traditional vehicles being driven also decreases.
Increasing Availability of Connected Vehicles
As connectivity—a digital cockpit platform of in-vehicle services that allows a car to communicate with other cars and infrastructures to ensure safety—becomes a standard automotive service in more than 90% of vehicles that are currently being sold, opportunity for revenue growth makes its way to the automotive industry.
Auto manufacturers are looking at the possibility of matching consumer behavior with automotive services. Such behaviors include knowing when the vehicle needs gas and recommending a service station fit to the driver’s preference. With these consumer behaviors integrated into in-vehicle services, we will see a rise in connectivity space, leading to more research and development and more opportunities for automotive investors.
What Will the Mobility of the Future Look Like?
We can expect to see a new wave of trends within the automotive world in the next 10-15 years—the biggest one being that individual vehicle ownership will decline as ride-sharing and autonomous vehicles become the new normal. Similarly, urbanization, population growth, and environmental concerns are key factors that new mobility forms will be required to serve.
Due to this, we can predict that the fossil fuel-powered vehicles we once drove will be a thing of the past as new consumer-centric electric vehicles become our future. Productivity will also be at an all-time high as increased operational performance of vehicles allows users to gain back valuable time they once lost to their commutes.
Additionally, the automotive industry will continue to be challenged as it tries to tackle new technological innovations. Innovations such as connectivity, electrification, and sensors are the major solutions the industry will need to focus on to maintain profitable business operations. We can expect to see these advanced technological solutions trending across the auto industry.
Though some might imagine that these technological innovations will put an end to traditional car dealerships, the reality is that digitization is also making its way into the automotive market. As car dealerships evolve, they are beginning to offer more digital tools to provide customers with a first-rate experience and to increase their financing transparency.
What Effects Will This Have on the Global Automotive Chain?
As the automotive industry undergoes big changes, collaborations with tech giants will be necessary in order to support the research and development that will integrate the future of mobility. This mobility change will not happen in the automotive sector alone. It will instead require the partnership of players from various market sectors—ultimately fostering innovation like never before.
The Future of Automotive Industry Manufacturing is Now
While the COVID-19 pandemic has caused a disruption in the automotive world, it also opened up the possibility of a new reality that can lead to reinvention and permanently change the future of mobility. However, the future of automotive industry manufacturing is now, and collaboration between different sectors will guide the future towards continued success. At ZT Motors, we’re always looking ahead so that we’re ready for the big changes headed our way.
Azhar Hirani manages the private equity sales team, which involves relationship management, advising and educating retail clients on new private investments, analyzing private equity portfolios, and oversight of clients’ invested capital in internal private projects. Passionate about business, marketing, and sales, Mr. Hirani maintains deep expertise in high ticket sales and has a record of success in sourcing capital and acquiring new customers.