From a consumer perspective, what are the pain points in today’s in-car experience and what types of unlocked experiences represent the largest business opportunities in Connected/Autonomous Cars?
Hi there, and thanks for asking Wonder! I understand you'd like an analysis of the pain points in today's in-car experience for consumers, combined with an analysis of the types of unlocked experiences representing the largest business opportunities in Connected/Autonomous Cars. The most useful source I found to answer your question was a GfK market research white paper. In short, the fear of breaking down, auto accidents, aggressive drivers and being stuck in traffic are the four top pain points in the in-car experience, both in the US and internationally. After exhaustive searches through marketing white papers, reports, and articles, and automotive industry white papers and articles, I determined that it is not possible to compile from available information an analysis of the 'largest business opportunities' relative to 'unlocked experiences,' which I understood to mean elements that autonomous cars could offer which normal cars don't have, and which would make the in car experience much better. However, I did learn that emerging markets are predicted to be a much more potent opportunity than mature markets. Below you'll find an deep dive of my findings.
PAIN POINTS IN THE IN-CAR EXPERIENCE
All the information I found during my research for this segment of the request focused on drivers. I did not find any research on pain points inclusive of car users other than drivers. I also did not find any high-quality 'top of' lists, so the information below is presented from the two most recent and most reliable sources I discovered in my research.
A 2015 GfK market research report identified 16 pain points for today's car drivers, of which 11 can be identified as 'in-car experiences.' Of these, four emerge as the most salient for drivers: breaking down, encountering aggressive drivers, being in an accident and being stuck in traffic. Although the percentages differ in comparison, these four pain points are the highest for both for the US individually, as well as for the aggregate response from international survey respondents in Russia, China, Brazil, Germany, and the UK.
> Being stuck in traffic: (no aggregate statistic) | 23% (US)
Although there was no aggregate statistic cited for international concern about being stuck in traffic, the report does note that "respondents in China, Brazil and Russia all highlight security as a particular concern, above all with regard to road accidents, traffic and theft. For example, Russian drivers are almost twice as likely to be concerned about being involved in an accident or stuck in traffic compared with British drivers."
The 2016 JD Power Vehicle Dependability Study found that technology problems top the list of consumer complaints relative to vehicle reliability, with the "biggest issues [being] balky voice recognition systems and problems with Bluetooth pairing." This problem is so salient that the number of complaints about "audio, communication, entertainment and navigation or ACEN" accounts for 20% of all consumer dissatisfaction, and has driven a significant 3% decline in vehicle dependability, year-over-year. This is particularly important relative to connected and autonomous vehicles, because consumer trust is necessary in both applications, particularly with the latter.
LARGEST BUSINESS OPPORTUNITIES
Extensive research through the above-noted sources indicates that any information relative to business opportunities within the connected/autonomous segment of the automotive industry is not specific to 'unlocked experiences,' which I interpreted as elements of autonomous/connected car design. Rather, the available information primarily indicates the opportunities presented by different elements of market analysis, which is a broader scale. Primarily, these are as follows: > Connected services sales by branded companies will fall 20% by 2022. "New entrants, including suppliers of new technology, mobility services, or digital services," can maximize on this opportunity, which is largely due to the difficulty of legacy brands being able to convert to digital in a timely way.
> "Supplier revenues will shift from engines, interiors, and chassis to electronics, software, cloud services, and batteries... suppliers of electronics and technology (including batteries) will benefit from strong volume growth and the comparably high margins their more sophisticated components will bring."
> The connected car market will shift from primarily high end vehicles (2017) to the volume market (2022), with volume market cars making up a projected 50% of connected car packages by 2022.
> The Chinese automotive market is the largest in the world, and growth in this country is projected to stay strong. Given the connection between "connected consumers, supportive government, and advanced technologies," China could possibly take the lead in the connected car segment of the automotive industry.
> Major invested players in connected and autonomous vehicle technology - and therefore potentially sound stock in which to invest - include: Google, Audi, Mercedes-Benz, Mobileye, STMicroelectronics, Delphi Automotive, and Autoliv.
To wrap it up: consumer 'in-car' pain points are consistent across international and US survey respondents, and the data indicates that breaking down, encountering aggressive drivers, being in an accident, and being stuck in traffic are the primary concerns. While information relative to business opportunities within the connected and autonomous automotive segments is not specific to 'unlocked experiences,' I was able to learn that China is a strong potential leader in the segment, and that new technological entrants have a significant window of opportunity for maximizing OEM's lack of digital integration. Thanks so much for asking Wonder, and please let us know if there is anything else we can research for you!