Technology has always had a strong relationship with the auto industry but it’s only recently that the full potential of this partnership is being realized. We are now seeing a new generation of cars on our roads that offer a new and enhanced driving experience.

1. DRIVING DISRUPTION IN THE
AUTOMOTIVE INDUSTRY
GfK 2012

2. TECHTALK - DRIVING DISRUPTION IN THE AUTOMOTIVE INDUSTRY
Technology has always had a strong relationship with the auto industry but it’s only
recently that the full potential of this partnership is being realized. We are now
seeing a new generation of cars on our roads that offer a new and enhanced driving
experience.
By Sam McCloy and Jonathan Shingler
Back in the 1980s, many relished that hour years. Alongside this, governments are wary
every week when they ’d switch on the TV of new technology integration, introducing
program ‘Knight Rider’ to watch ‘The Hoff’ drive legislation to limit technology usage in order to
around in a black sports car. Not only did the limit driver distraction. Finally, adverse economic
car look good, but it could speak with the driver, conditions have inhibited development beyond
pinpoint locations using satellite technology
and drive itself to those locations. It also let the
driver communicate with colleagues via video THE INCREASING
conferencing and advised on the coolest places
to hang out. A truck that acted as a central base ROLE THAT THE
could track the car’s movements and process the LATEST SMARTPHONE,
data (known as telematic information) to advise
on optimum driving style, driver and car health. NOTEBOOK AND HOME
The Hoff was also given local intelligence to help ENTERTAINMENT
him to save the girl from the bad guys. It certainly
offered an exciting sci-fi vision of what a car may
TECHNOLOGIES ARE
be able to do in the future. And some recent, PLAYING IN CONSUMERS’
interesting developments could see some of these
fantasies become a reality.
LIVES ARE DRIVING CHANGE
IN THE AUTOMOTIVE
Tech adoption to date
Much of the technology just mentioned has
INDUSTRY
been around for a while but has taken a long
time to be adopted by automakers. So what has the normal chassis/body/engine refreshes. Tech
been stopping them? A key reason is product adoption has been largely limited to iPod and
development lifecycles. Car templates (particularly Bluetooth integration, and is usually thrown in
the internals) only get refreshed every 6-10 as an afterthought.
GfK 2012

3. TECHTALK - DRIVING DISRUPTION IN THE AUTOMOTIVE INDUSTRY
However, things are changing. The increasing Telematics: getting to know the driver
role that the latest smartphone, notebook and Meanwhile, integration of telematic information in
home entertainment technologies are playing cars is starting to happen, as demonstrated by the
in consumers’ lives are driving change in the showcasing of Ford’s Evos car in late 2011. Cloud-
automotive industry. Consumers now expect to based connectivity, coupled with automated and
have such technologies integrated seamlessly customized system calibration enables the car
into their cars. Consequently, to stay competitive,
automobile manufacturers must anticipate such
consumer technology needs to help them ‘future- TO STAY COMPETITIVE,
proof’ the latest models, and through that to
instigate a long-overdue shake-up of the industry. AUTOMOBILE
MANUFACTURERS
The rise of infotainment
Infotainment is an area where such changes are
MUST ANTICIPATE SUCH
occurring. Car companies are forming partnerships CONSUMER TECHNOLOGY
with innovative technology brands. For example,
Audi is using NVIDIA’s latest mobile quad-core
NEEDS TO HELP THEM
Tegra 3 processors and Sierra LTE modules to ‘FUTURE-PROOF’ THE
power its in-car systems. The possibility of
integrating these technologies with Android or
LATEST MODELS, AND
Windows Mobile-based operating systems opens THROUGH THAT TO
a whole new world of in-car application services.
INSTIGATE A LONG-
Obviously, Apple and Google have had plenty OVERDUE SHAKE-UP OF
of success with their App Stores and the tablet THE INDUSTRY
market has widened application remits to make
more use of larger screens. These changes will
naturally evolve within the automotive industry to recognize the driver, monitoring his or her
as apps are developed to specifically meet driver driving style, as well as basic health information
and passenger needs. This will help to provide such as the heart rate. All of this telematic data is
seamless transitions from home to car to work, transmitted and saved to the cloud via 3G or 4G/
and back again. Software and app upgrades can LTE connectivity which is embedded in the vehicle.
also be used to help disrupt the long 6-10 year As such, the car can ‘get to know’ the driver over
car development cycles. time, adjusting its set-up to match the driver’s
GfK 2012

4. TECHTALK - DRIVING DISRUPTION IN THE AUTOMOTIVE INDUSTRY
style, mood and health, and to provide optimum speed control). This does, in some respects, go
safety throughout the journey. Location-based against the 20th century image of the car offering
services may also be included to monitor not only a sense of freedom. Although the reality of car
the driver, but also the environment (for example ownership has long moved away from that notion,
automatic switching to electric from gas when it is still used by many car advertisers.
moving from highway to city areas).
So, with the possibility of telematics being used
as a means of further control by insurance
INSURANCE COMPANIES companies and governments, it remains to be
seen how it will impact the industry, and whether
CAN ALSO USE THE that will ultimately be a positive or a negative for
DATA IN AGGREGATE TO consumers. With all this in mind, new technology
needs to be carefully managed as it becomes
SEGMENT DRIVERS MORE integrated into cars, and the ability to ‘opt-in’ will
EFFECTIVELY, AND TO very likely play a role in this.
BETTER TIER THEIR RATES Looking ahead
ACCORDING TO DRIVER AGE, On the whole, convergence of the technology
and automotive industries offers some exciting
GENDER AND SITUATION possibilities with developments in infotainment
and sophisticated integration with consumer
Telematics is also becoming a powerful tool for all lifestyles as well as communications. Nevertheless,
sorts of new business and public sector models. as real-time tracking data become readily
It has already been adopted in the insurance available, governments, regulatory bodies, and
sector where some companies offer ‘black-box’ insurance companies will be able to control driver
solutions to track drivers over time. This is seen behavior further. Whatever happens next, there
as a ‘foolproof’ method of keeping premiums will inevitably be a period of adjustment, and
down. Insurance companies can also use the data ultimately, the driving experience is likely to be
in aggregate to segment drivers more effectively, radically altered by the end of the decade.
and to better tier their rates according to driver
age, gender and situation. For further information, please contact:
Other applications for telematics include fleet Sam McCloy, sam.mccloy@gfk.com or
management and traffic optimization (including Jonathan Shingler, jonathan.shingler@gfk.com
GfK 2012