Arthur D. Little (ADL) today released the third edition of its Global Automotive Mobility Study. Entitled \u2018The Future Of Automotive Mobility\u2019and based on a global survey of over 8,500 end customers in 13 countries, it shows that global automotive markets are currently at acrossroads. While the study identifies that the internal combustion engine still dominates the market, many vehicle owners are weighing up the pros and cons of going electric \u2013 as a result, there is confusion about where the automotive sector is heading and at what speed.<\/p>\n\n\n\n
Whereas ADL\u2019s previous Global Automotive Mobility Study in 2018 depicted a \u2018business as usual\u2019 industry only just taking its first steps towards electric, the mobility landscape three years later is markedly different. For example, there has been a dramatic change in both demand for cars and how ownership of them is perceived \u2013 while theCOVID-19 pandemic has highlighted the protection and independence that a private car offers, a significant number of people are contemplating giving them up for environmental reasons and embracing alternative transport solutions.The auto industry\u2019s 2% compound annual growth rate is much less than ADL\u2019s last survey predicted.<\/p>\n\n\n\n
The study also shows that the move away from petrol and diesel fueled vehicles is real and growing stronger \u2013 asked about their next vehicle, 29% of survey respondents favored a hybrid product, while 12% were considering the move to pure electric. And if established brands don’t provide an EV offering, many of their customers are ready to migrate to other manufacturers. However, market growth is hampered by both limited model range and an immature charging infrastructure, with vehicle range still dictated by the availability of public charging points.<\/p>\n\n\n\n
One of the study\u2019s most intriguing findings is the emergence of China as a \u2018special market\u2019 with markedly different attitudes to consumers in the rest of the world. For instance, while excitement over self-driving autonomous vehicles has dimmed in both Europe and the US due to safety fears, 71% of Chinese drivers remain positive about using such vehicles. They are also more adventurous in trying new powertrains, mobility services, and even purchase options \u2013 71% of drivers in China would be willing to buy a car wholly online, against 35% in Europe and 42% in the US.Given the size of China\u2019s domestic market, these attitudes could have significant implications for the global automotive industry.<\/p>\n\n\n\n
Klaus Schmitz, co-author of the study and Partner in ADL\u2019s Automotive and Manufacturing Practice<\/strong>, comments: \u201cWhile the global automotive industry isn\u2019t exactly in turmoil, the findings of this study definitely indicate significant turbulence,plus anuncertainty about the speed and direction of the market. Established trends are meeting new, emerging ones, which has inevitably led to a state of flux. We believe that the industry faces four main market-related challenges: how to better anticipate changes in vehicle demand and ownership profile; how to better transition towardselectric; how to profitably grow the mobility services segment; and how to optimize the new value chain.\u201d<\/p>\n\n\n\n Wolf-Dieter Hoppe, co-author of the study and Partner in ADL\u2019s Automotive and Manufacturing Practice<\/strong>, adds: \u201cGiven the degree of uncertainty in the sector, the automotive industry needs to develop a better understanding of the modern driver\u2019s priorities if it is to fully exploit electric\u2019s potential and counter concerns over autonomous vehicles. This will require an evaluation of current investments and an informed calculation about how markets and the value chain will look in ten years. For those manufacturers who get this right, there will be significant opportunities.\u201d<\/p>\n\n\n\n