A new research by HIS Markit that there would be multidimensional competition in the automotive sector in the future driven by new business models, convergence of disruptive technologies and government policies.
“Many of its advantages as a fuel, such as its high energy density, will persist. And the size of the current automotive ecosystem will moderate the pace of change,” claims the study.
The study says that change in the automotive sector would be driven by shifting priorities in purchasing vehicles as consumers would buy “mobility” instead of cars. The study examined the key markets of China, Europe, India and the United States and concluded that around 11 billion miles per year would be the vehicle miles traveled (VMT) by 2040 which would be an all-time high and about 65 percent more compared to 2017. But there would be substantial slowdown I n the sales growth of first hand light-duty cars.
There is expected to be profound changes in personal transportation than experienced over the past century combined, in the near future compared to the development and changes in the last 30 years of transportation and that change would be driven by the disruptive force of “mobility-as-a-service” (MaaS) like ride hailing services and tussle between the internal combustion engine and electric vehicles. Added to these would be the commercial launch of autonomous vehicles.
“A great ‘automotive paradox’—where more travel via car than ever, but fewer cars will be needed by individuals—will be a defining quality of the new automotive future,” said Daniel Yergin, IHS Markit vice chairman, Pulitzer Prize-winner and project chairman. “The shift is just beginning. By 2040, the changes in transportation will be accelerating in a way that will be visible on roads and highways around the world. The pace and degree of this dynamic shift will have significant implications for industry, for public transportation systems and for how people get to work and live their lives – and spend their money on transport.”
“We could very well be on the cusp of the greatest transformation in personal transportation since the dawn of the automotive age,” added Jim Burkhard, vice president, global energy markets and mobility. “Understanding the implications of such a transformation requires a broad perspective that goes beyond any single industry or market.”
The study claims that amongst the most disruptive forces in the future would be the rise of the mobility-as-a-service (MaaS) providers. In comparison to just 300,000 in 2017, by 2040, about 10 million cars are expected to be bought by the MaaS industry just within the key markets that the study was limited to.
“Mobility service companies will be a prime driver of shifting car sales from personal to fleet economics,” said Tom De Vleesschauwer, transport and mobility practice leader, IHS Markit. “Ride hailing has the potential to be so disruptive because it is often the most convenient for consumers and can significantly increase access to car transport, particularly in markets with low car ownership rates.”
(Adapted from Businesswire.com)