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Top 20 Post-Covid Automotive Trends (Part I)

  • I usually begin the year with a roundup of the top automotive trends for the upcoming year. Not this year though. If anything, the Covid crisis has completely overturned every prediction and projection made at the beginning of 2020. 

    In the past few months, my team and I started from scratch, tracking and dissecting the effects of the pandemic on the mobility industry. After much heated discussion (that’s one thing that’s remained unchanged, pandemic or not!), here is our pick of the top 20 trends that we believe will shape the future of the auto manufacturing industry in a Covid-defined 2020 and beyond.

    It’s All About Change

    Data As The 21st Century Oil, The Shift From “Horsepower” To “Computing Power”: Data-as-a-service is set to grow post Covid. A key transformation, echoed in Tesla’s differentiation strategy, will be the move from horsepower to computing power. In contrast, the continued focus of German and Japanese automakers on horsepower could soon end up becoming misaligned with the new digital architecture requirements of vehicles.

    Autonomous Level 2.5 To Become Stop Gap Preference: Covid has derailed plans to leapfrog from Level 2 to Level 4 of vehicle autonomy. Automakers are now contemplating two divergent approaches: first, the Tesla strategy which aims to combine camera-based technologies to push onto Level 5 and, second, the proceed-with-caution strategy which seeks to persist with Level 2.5 for a period of time before ramping up to Level 4. There’s also the eternal development vs deployment debate. I am willing to wager that deployment rather than development will determine the winner of the autonomous race and that China will be the first to dash over the finish line.

    Shakeup Of The Fleet Market: Typically, fleet markets have always made gains during a period of recession. This time might be a little different. Hertz’s collapse is symptomatic of the market’s decline. Car allowances might be (pay) cut by corporates, causing the lucrative corporate fleet market, especially the premium segment, to suffer. A glimmer of hope will come in the form of growth in private leases.

    Growth In Subscription Services: I’ve always been bullish about subscription services and continue to be upbeat as they spread rapidly to developing automotive markets. I foresee two major shifts here: one, from the premium segment to more volume segment offerings and, two, from being primarily city-based models to becoming more pan-country based models.

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