Guest Story by Judy Cubiss, Global Industry Marketing Lead, Automotive & IM&C, SAP America, Inc.
Last week, SAP was honored to host the first ever Center for Automotive Research Industry Briefing in Silicon Valley. The event was titled “Bridging Detroit and Silicon Valley” and it truly did that. Attendees came from both Detroit and the West Coast; and included automotive manufacturers, suppliers, research/innovation hubs, mobility platform providers, and industry analysts.
There were some common themes that resonated throughout all the sessions represented below:
Jim Davis Jr, NA Automotive Industry Business Unit Lead at SAP, looking thrilled next to the Revero.
Although there are many innovations in customer experience, there was a recognition that there is still a baseline of expectations/requirements that must always be met. One of my favorite phrases from the day was that “manufacturing still matters”. David Twohig, Chief Vehicle Engineer at Byton, was very insistent that “New players (in the industry) still require mastery of vehicle engineering”. However, he continued that it needs to be accompanied with a change in perspective: all automotive companies must shift from being, “Driver Focused to User Focused”, adding that “Data Power” will replace the importance of “Horse Power” in the future.
In the first panel, speakers from AutoPacific, IHS, and UBS provided great insights into the North American Automotive Industry. They shared how rising student loans, car prices, and the younger generations ambivalence to car ownership has resulted in a downturn of cars sales both new and replacement; so industry volumes continue to trend downwards. Ed Kim, VP at AutoPacific, highlighted that technology has allowed the US truck market to thrive. While Colin Langan, Analyst from UBS, expanded on some of the challenges facing autonomous vehicles – especially the need for near perfection and some of the regulatory considerations.
The second panel, Smart Mobility and Smart Cities, discussed the evolution of the automotive industry and the blurring of industry boundaries. Frank Sgambati, Director of Business Development and Smart Cities at Bosch, highlighted that the almost doubling of population in cities resulting in 6 Billion people by 2050 will have a profound impact on energy, waste, and traffic to name a few areas. Charging of electrical cars / fleets in cities remains a key barrier to using electric vehicles in cities – as many apartment buildings do not provide charging sites. Mark Thomas, VP of Marketing and Alliances at Ridecell, suggested that partially autonomous vehicle fleets could be a good interim step – it doesn’t have to be all or nothing. Cars could drive themselves to charging sites, or to pick up customers. However, these models will require collaboration, partnerships, and technology. Mark Thomas also pointed out that as private vehicle ownerships declines, the companies and industries that step up to the new mobility paradigm will be the winners: and it may not be the industries that you think. For example, dealers already have many of the core capabilities need to manage and service cars in local areas. Nikhil Gupta, Site Director at Magna Autonomous Systems, built on the need for collaboration and partnerships on the technology side saying that modular and scalable platforms will be the essential strategy going forward.
The last panel of the day, Innovation to Implementation, raised some interesting questions. “The necessity of interoperability” was paramount for Peter Polit, VP at Sirius XM. His statistics on the amount of testing that SiriusXM must execute to roll out new versions of their software was mind blowing. All the panelists agreed that innovation requires a good business model and needs to drive value – removing friction for the customer will be a key ingredient for success.
From Left to Right: Carla Bailo, CAR; Peter Polit, Sirius XM; Stephen Xu, P3; Simon Hougard, Renault-Nissan-Mitsubishi
Jim Davis Jr, NA Automotive Industry Business Unit Lead at SAP, focused on the synergy’s and complementary skills and attributes of Detroit and Silicon Valley during his keynote – the yin and yang of automotive. Both styles and skills have value and, if they work together, the value and innovation will be immense. Carla Bailo, President & CEO of CAR, closed out the day with a most intriguing question, “What are the most common misconceptions of Detroit by Silicon Valley and visa versa?”. What do you think? Would love to hear your opinions, tweet me at @jucubiss