December 02, 2013

Strong Interest in new In-Car Technologies by Consumers in Emerging Economies Could Influence Demand, Accelerate Rollout of Next-Generation Connected Vehicle Technologies, Accenture Research Indicates

NEW YORK; Dec. 2, 2013 – High interest in next-generation in-car technologies among drivers in emerging economies could help shape future demand for sales and provide the automotive industry with a sustained revenue stream, a new survey by Accenture indicates. The survey shows that drivers are twice as likely to choose a car based on in-vehicle technology options than its performance, demonstrating the continued importance of the connected vehicle to the automotive industry.

The survey of 14,000 drivers in Brazil, China, France, Germany, Indonesia, Italy, Malaysia, South Africa, South Korea, Spain, the UK and the United States examined their current use of connected vehicle technologies and expectations for future use. Technologies and digital services covered by the survey included navigation and traffic services; a range of autonomous driving aids; in-car services, including entertainment, work tools and learning; safety services; black box-type monitoring of a person’s driving patterns that can help reduce insurance premiums; and a number of passenger-related services. Thirty-nine percent of the drivers surveyed said that their primary consideration in choosing a new automobile is in-car technology, compared with 14 percent who said driving performance had the greatest influence on their choice.

According to the survey, drivers in China, Brazil, Indonesia and Malaysia expressed the strongest interest in all of the connected vehicle technologies and digital services currently available, which are used widely by consumers in more mature markets. Among the respondents in emerging economies, Chinese drivers had the highest current usage and greatest desire for future use of most of the technologies and services, followed by drivers in Brazil, Indonesia, Malaysia and South Africa.

“Combined with the increased use of connected vehicle technologies and digital services among consumers in mature markets, the high demand across the emerging world will no doubt speed the development and influence the rollout of next-generation products and services by the global auto industry,” said Luca Mentuccia, global managing director for Accenture’s Automotive practice. “This is especially significant considering that nearly 40 percent of drivers surveyed indicated that in-car technology is the primary factor they consider in purchasing a new car.”

While there is ongoing debate about the future and safety of driverless cars, Accenture’s research shows that, on average, 90 percent of the survey respondents have an interest in some autonomous driving options, primarily those related to safety. The most popular features include lane-changing warning systems, collision-warning systems, lane-keeping systems, automatic braking systems that prevent hitting an object and fully automatic parking.

Accenture believes that the demand for individual aspects of autonomous driving will encourage original equipment manufacturers (OEMs), regulators and industry organizations to address the issues that are currently preventing the widespread use of driverless vehicle technology.

The research uncovered strong interest among consumers in vehicle health reports and vehicle lifecycle management services. According to Accenture, OEMs that are able to tap into this demand could open up new revenue streams around maintenance-related digital services and engine and parts wear and tear. While only 13 percent of drivers surveyed said they currently use a vehicle health report and 12 percent use vehicle lifecycle management services, 39 percent and 37 percent, respectively, expect to start using these services soon.

“This increasing level of demand could lead to the rise of concierge-type digital services as drivers outsource the real-time monitoring of engine performance to third-party service providers, expanding the OEM after-sales revenue model,” Mentuccia said. “However, as drivers increase their demand for next-generation connected vehicle technologies across navigation, infotainment, safety, autonomous driving and mobile device integration, vehicle manufacturers face a challenge in being able to meet the complex integration requirements of a broad array of technologies in each range of vehicles. They must also look at maximizing sales by incorporating the right technologies into the appropriate vehicle range in each country.”

Accenture believes that the ability to source data from vehicles will enable a range of new business-to-business and business-to-consumer digital services. For OEMs, detailed data from vehicles could help them improve their engineering processes, reduce warranty costs and improve their relationships with dealers by helping dealers manage parts inventory and service.

Data sourced from vehicles could also be used to enable a portfolio of value-added B2C services, including vehicle diagnostics, driving dashboards and concierge services, delivered to drivers through multiple devices: a vehicle’s head unit, a driver’s smartphone and/or tablet.

When examining individual country responses, the following trends emerged:

• Brazilian drivers show a strong interest in the majority of connected vehicle services and also are the most influenced by technology, over engine performance, when it comes to making a vehicle purchase. They are the most likely group to pay for services using a monthly fee and they are most interested in giving full social media connectivity, a specific capability for reading and dictating emails and car-to-car communications to passengers.
• Drivers in China show the highest interest in twenty areas of connected vehicle technologies and digital services for drivers, more than any other country. In most cases Chinese drivers have the highest current usage of these technologies and services.
• Drivers in France would like passengers to have access to a driver fatigue warning device but show a very low interest in real-time social media and gaming infotainment services.
• When asked about payment choices for connected vehicle services, drivers in Germany have the biggest interest in a free basic service, paid for by advertising, compared to the other countries. They are the least likely to use real-time news, sport and weather information. They also have the lowest interest in a number of the technologies that allow for maintenance-related services.
• Indonesian drivers have the highest interest in real-time entertainment content such as social media and gaming, as well as productivity services such as email and calendar content. They are also very interested in using educational and e-learning services in the car and the most likely group to pay for connected vehicle services through a single purchase for a predefined period.
• Italian drivers would like to allow passengers to use a system that enables them to stop the vehicle if the diver is incapacitated or taken ill.
• Drivers in Malaysia have a strong interest in car parking space detection systems as well as fully automatic parking assist systems. In the event of an emergency, respondents said they wanted a system that stops the car and automatically sends out an emergency call.
• South African drivers have the highest interest in a range of safety features, including an automatic emergency call service for their vehicle when a crash takes place, lane changing warning systems, fatigue warning devices and collision warning technology. They are the current highest users of vehicle tracking services.
• South Korean drivers show some of the highest interest in using a range of the digital travel services such as live traffic information and local searches for points of interest. They are the highest current users of ‘black box’ services that monitor driving to reduce insurance premiums.
• When asked about general use of connected vehicle services, Spanish drivers are the most likely group to use them only for better driver experience and minimizing driver distraction. They have the highest interest in an automatic emergency call service for their vehicle and lane-keeping technology.
• UK drivers are the only drivers who still see engine performance as more important than the car’s driving performance when buying a new car. They show the lowest level of interest in real-time entertainment services such as social media and gaming, as well as productivity services such as email and calendar access.
• Drivers in the United States have the lowest interest in connected navigation services such as real-time traffic information and have very low interest in productivity services such as email and calendar access.

With technology now the most significant criteria in vehicle buying decisions, manufacturers are turning to digital technologies to shape demand for the next generation of connected vehicles. Social car shopping tools and even crowd funding for car purchases have started to emerge, where social media is being used to customize new cars. Accenture predicts a rapid increase in new digital strategies, digital technologies and digital processes by OEMs as they seek to innovate, compete and expand as their customers seek out the next generation of connected vehicle services.

“Connected vehicle technology is rapidly becoming a key car-purchasing criterion,” Mentuccia said. “As a result, it also is dominating much of the industry’s advertising campaigns. Going forward, consumer expectations for better technology will require that manufacturers provide more customized, interactive websites to better aid consumers in making car-buying decisions. Accenture research has shown that the industry needs to consider adopting digital innovations, such as web chat and mobile-enabled websites, to enhance consumers’ digital shopping preferences.”

About the study
The survey was conducted by Coleman Parkes Research. It consisted of 14,195 online interviews amongst adults in Brazil, China, France, Germany, Indonesia, Italy, Malaysia, South Africa, South Korea, Spain, the UK and the United States In all regions at least 1,000 interviews were completed with the exception of China where 3,000 interviews were undertaken. All respondents had a car at their disposal and either had, or were planning to buy, a smartphone.

About Accenture
Accenture is a global management consulting, technology services and outsourcing company, with approximately 275,000 people serving clients in more than 120 countries. Combining unparalleled experience, comprehensive capabilities across all industries and business functions, and extensive research on the world’s most successful companies, Accenture collaborates with clients to help them become high-performance businesses and governments. The company generated net revenues of US$28.6 billion for the fiscal year ended Aug. 31, 2013. Its home page is www.accenture.com

The Accenture Connected Vehicle Business Service provides asset-based services and end-to-end solutions to automotive and heavy equipment companies, and suppliers. Through the use of Accenture’s proprietary on-board and connectivity solutions, telematics assets and big data, Accenture can design, build and run a range of technology services to improve the customer experience and create efficiencies in areas such as real-time predictive monitoring and maintenance. Manufacturers can benefit from new streams of revenues generated by Accenture’s application of analytics, process improvement, program management and integration capabilities for third-party providers.

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Contact:
Val Brown
valdina.brown@accenture.com
+1 313 204 5699

Anthony Hatter
anthony.hatter@accenture.com
+44 7810 756 138