LAS VEGAS — Despite recession fears and the tightening of capital markets in 2023, the world’s automotive and mobility sectors will expand their rapidly evolving digital transformation, Consumer Technology Association chief economist Steve Koenig said at CES on Tuesday.
The transformation will be spearheaded by the development of an electrification ecosystem. Advancements in self-driving vehicles and the continued emergence of a subscription-based service business model for electric vehicle features are the other top developments that will shape the automotive and mobility sectors over the next decade, Koenig said.
The expected increase in EV use by consumers and businesses over the next 10 years will create a need for a far greater and more complex infrastructure to ensure that the electric transport sector is viable, Koenig said.
“What I’m talking about is advancements in battery chemistry, battery design, also charging systems,” Koenig said. “Because having more electric vehicles is one thing, and that’s how we grow the market.”
Koenig said battery technology advancements that allow consumers and businesses to drive farther on fast charges will be the centerpiece of the electrification ecosystem’s development.
While a nationwide transition to EVs is well underway, the auto industry is facing other hurdles that will influence technology development.
The Federal Reserve’s interest rate hikes over the past year, along with the Russia-Ukraine conflict, and the COVID-19 pandemic’s impact on global supply chains have dampened the autonomous vehicle subsector’s outlook.
But autonomous vehicle tech companies at CES are looking to show investors how they will offer value in 2023.
“We’ve been talking for years and years about self-driving vehicles happening, but now we’re starting to see autonomy really earnestly move beyond passenger vehicles,” Koenig said.
Self-driving heavy trucks are leading autonomous technology development, he said.
A global labor shortage of truck drivers and other logistics workers will force companies to turn to technology to address these issues, Koenig said.
The American Trucking Association estimates that the U.S. will have a shortage of 160,000 truck drivers by2030, Koenig said.
“How are we going to close that gap? Technology has to be the answer, so self-driving trucks will be very important. Humans are the nice-to-have, but technology has the answer,” Koenig said.
The emergence of personal vehicles becoming a marketplace for services will unlock recurring revenue possibilities for automakers. Koenig described this as the “screen-ification” of the automobile.
These new applications will be supported by 5G broadband Internet infrastructure and offer services besides entertainment.
“Now cars are becoming marketplaces and not just for the passengers, but also the driver,” Koenig said.
Koenig cited voice control to illustrate how vehicles will become marketplaces.
“We think about voice control. The old way is I order my latte from Starbucks on my app. They’re working on it. I’m going to go pick it up,” he said. “The new way is using voice control and services to order that latte while you’re driving.”
Koenig also referenced BMW’s infamous 2022 announcement that it would offer an $18-a-month subscription for drivers to use heated seats in new models as an example of where the auto industry is headed in its push for recurring revenue sources.
“You’ve heard about paying a subscription fee for your heated seats. Will that be the tip of the iceberg? I don’t know,” Koenig said. “We’re going to find out. And maybe some of the vehicle OEMs here at CES 2023 will have something to say about that.”
