The connected car market is expected to boom but there are some glitches. Ridesharing could reduced vehicle sales for some consumers. V2X is starting to gain momemtum and infotainment systems are booming in not just sound but profits.
Ridesharing and Car Sales
Ridesharing usage may not negatively impact the future vehicle purchase intention of current vehicle owners. According to the Automotive Connected Mobility (ACM) service at Strategy Analytics “Impact of Ride Sharing Frequency on Vehicle Purchase Intention.”
The report notes:
- Ridesharing usage actually increased the likelihood that current vehicle owners would purchase another vehicle within the next five years. This was true across the US, Europe, and China.
- Frequent ridesharing users that also own their own vehicle had greater transportation needs than those that don’t. Ridesharing fills a niche that is convenient but will not supplant their personal vehicle.
- Millennials that had no children and used ridesharing at least once a week were less likely to purchase another vehicle within the next five years than all respondents that had children.
“The question of how emerging transportation options like ridesharing and car-sharing will impact vehicle sales is a very complex one to answer. Issues of cost, convenience, usability, privacy, type of journey, and length of journey all impact transportation choices,” commented Chris Schreiner, report author and Director of Syndicated Research, UXIP. “Frequent ridesharing users do not seem likely to delay their next vehicle purchase, but it is still possible that they might choose a less expensive or lower class vehicle. Alternatively, they may choose to downsize their fleet from three vehicles to two.”
Added Kevin Nolan, VP UXIP, “However, it is prudent to note that external factors such as ridesharing competition reducing end user costs, expanded availability and autonomous taxis, all have the ability to negatively affect consumers’ future purchase decisions.”
V2X Gaining Momentum
After languishing for more than a decade, ABI Research sees V2X finally gaining momentum in the smart mobility industry. Illustrating this is a growing number of initiatives, trials, and product launches. Cellular V2X, aggressively promoted by the 5G Automotive Association (5GAA), now offers a potentially more flexible alternative to the legacy IEEE 802.11p. Vehicle-to-Vehicle (V2V) and Vehicle-to-Infrastructure (V2I) collectively refer to V2X.
V2X use cases will now include collective perception, remote sensor fusion, and cooperative mobility. This is happening as awareness grows surrounding the critical role of V2X to bring the reliability and robustness needed for level 4/5 vehicle automation.
“Though gaining traction, the V2X industry has not yet come up with a credible, convincing strategy for widespread installation, adoption, and use of V2X capabilities, which require near 100% penetration levels,” says Dominique Bonte, Managing Director and Vice President at ABI Research. “Relying on consumers to pay for optional V2X functionality and thereby achieving widespread consumer adoption within reasonable timeframes is wishful thinking, especially when taking into account long vehicle replacement cycles. Moreover, efforts to impose a V2V mandate in the U.S. remain surrounded by uncertainty amidst mounting discussions about radio spectrum.”
“A more realistic scenario would be to equip vehicles designed for car sharing with V2X tech within smart city and Mobility as a Service contexts,” continues Bonte. “This would avoid the pitfalls of B2C models and instead leverage fleet-based B2B approaches.”
In the meantime, the V2X paradigm is becoming increasingly diversified and will extend to market adjacencies like Vehicle-to-Home (V2H) and Vehicle-to-Grid (V2G).
“V2X will evolve into a ubiquitous IoT-like, cross vertical connectivity and application paradigm, one that reaches far beyond the initial narrow scope of active vehicle safety and the DSRC/WAVE protocol,” concludes Bonte.
Infotainment Market $37.26 Billinon by 2025
The global automotive infotainment market is expected to reach USD 37.62 billion by 2025, according to a new study by Grand View Research, Inc. The increasing adoption of smartphones is anticipated to have a significant impact on the in-car infotainment market, as they are the most prominently used connectivity gateways of an infotainment system.
The demand for enhanced driving experience is also predicted to drive the market over the forecast period. The increased focus on driver comfort and convenience has led to the development of various automotive infotainment systems, which offer innovative features such as voice control, Bluetooth connectivity, real-time traffic updates, and navigation information. These features provide comprehensive vehicle information to the driver and thereby, enhance safety and driving experience. However, these systems involve high costs of integration and are primarily integrated in premium and luxury vehicles. Inadequate infotainment security and privacy are predicted to hinder the growth of the automotive infotainment market.
The use of infotainment systems in commercial vehicles is mainly driven by the widespread adoption of navigation units. The implementation of navigation and communication units in a commercial vehicle has increased operational efficiency and enabled a reduction in response time during emergency situations. As commercial vehicles have high travel time, compared to passenger cars, improving safety and driver experience is very essential.
Further key findings from the report suggest:
- The communication unit dominated the product segment and was valued at USD 3.9 billion in 2016.
- The head-up display segment is expected to be the fastest-growing segment with an anticipated CAGR of 13.5% over the forecast period.
- The key success factor for various participants to gain traction in the market is building cost-effective and driver-centric automotive infotainment systems.
- Automotive infotainment aftermarket products are cost-effective, as compared to OE fitted, and are much preferred by price sensitive consumers.
- The passenger car segment is expected to grow at the highest CAGR of 11.4% over the forecast period, owing to the growing trend of low-cost passenger cars
- The Asia Pacific region is predicted to witness a CAGR of 11.3% during the forecast period, owing to the presence of prominent OEMs such as Hyundai Motor Company and Toyota Motor Corporation.
- The key industry participants of the market include Continental AG, Harman International, Panasonic Corporation, Alpine Electronics, Inc., Denso Corporation, Pioneer Corporation, Visteon Corporation, Clarion Co., Ltd., Delphi Automotive PLC, and JVC KENWOOD Corporation.