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WHO’S GOING TO ANTE UP? PART 1

ONE OF THE neat spiffs of a subscription to Automotive News is its occasional addition of Deloitte Insights. Early in 2019, I shared tidbits from Deloitte Insights: Express Land Ahead. Here in Parts 1 and 2 today and tomorrow are more recent tidbits from this international consulting firm on a tantalizing topic: Who is going to pay for coming advances in personal mobility?

Return on Investment? Notes Deloitte, “Stakeholders up and down the automotive value chain are pumping in billions of dollars into making connected, autonomous, shared, and electric vehicles (EVs) a reality…. However, results from the 2020 Deloitte Global Automotive Consumer Study suggest that achieving a return on invested capital for new technologies may be more difficult than some automakers think.”

Auto industry proposals include acquiring technical expertise from without rather than in-house, forging partnerships with other automakers to spread R&D costs, and reducing their global manufacturing footprints. These, Deloitte suggests, may not be enough.

Image from Deloitte Insights: Industry 4.0 in Automotive.

How Much Are Consumers Prepared to Pay? Deloitte observes that consumers in the more mature automotive markets “have been trained for many years to expect manufacturers to introduce advanced technologies at little or no additional cost as a way to differentiate themselves in the market.”

Here’s a Deloitte breakout of today’s consumers who refuse to spend $500 for each of today’s hot technologies.

Source: 2020 Deloitte Global Automotive Consumer Study.

Given that even an upgraded sound system can cost considerably more than $500, these data are hardly encouraging to automaker engineers assessing the costs of car-to-car connectivity or self-driving or electric propulsion.

Image from Deloitte Insights: Industry 4.0 in Automotive.

Tomorrow in Part 2, Deloitte raises another crucial aspect of paying for future advanced mobility: You do want streets and roads too, right? ds

© Dennis Simanaitis, SImanaitisSays.com, 2020

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