Future of Automotive Mobility Study

How mobility providers should adapt to profit from tomorrow's value chain

The rapid pace of change in the automotive industry and beyond is fueling the debate on how to identify future value. In order to help industry players understand these looming changes, Deloitte presents the new "Future of Automotive Mobility Study", which includes quantitative and qualitative data from executive sessions and interviews, an international customer survey, and a new profit pool simulation tool. This study focuses on the US and EUROPE5 regions (France, Germany, Italy, Spain, and the United Kingdom) – two of the largest automotive markets in the world – to cut through the fog of rapid change. We examine the mobility value chain and the eleven shifts in profit pools expected in the coming decade.

For automotive mobility providers, the business landscape may seem to be in a state of flux. The report suggests that revolutionary thinking will be required in order to overcome uncertainty and ensure future success. Nevertheless, steady growth is forecast to almost double the size of the US automotive mobility market by 2035 - with the European market unlikely to be far behind - suggesting a positive outlook for the evolution of the automotive industry. 

Challenges for automotive mobility

Change is coming, whether mobility providers are ready or not. What they do next could determine their success or failure in the years ahead. Rapidly changing consumer preferences, growing inequality, increasing polarization, urgent climate change, declining trust, and a shifting geopolitical order have driven the automotive industry's conversations about the evolving mobility ecosystem, particularly its focus on technology. 

However, as the future comes into focus, mobility providers should focus on value. Indeed, the automotive mobility value chain is becoming increasingly important to providers - from captive and non-captive leasing companies to rental companies and fleet management companies - and the industry is constantly adapting to the disruptions that may become even more pronounced in the future. 

In the face of generational transformation, automotive leaders in both markets may consider identifying and embracing fundamental changes to address new and shifting business challenges. Such strategic imperatives could drive industry players to develop a sustainability mindset and new skill sets, as well as technologies focused on a digital-first, customer-centric approach to business operations, which in turn can help create new data-driven revenue streams.

Deloitte Future of Automotive Mobility Study

The 11 shifts in profit pools

As part of the Future of Automotive Mobility Study, we examined the entire mobility value chain. In doing so, we focused on eleven different shifts in the profit pools that can be expected to occur in the coming years. These are: 

Social impacts: Demographic changes, urbanization, and COVID-19 pandemic concerns are impacting the automotive industry. 

Ecological impacts: The industry is reconsidering its carbon footprint, fleet transition from internal combustion engine (ICE) vehicles to electric vehicles (EVs), refinancing, etc. 

Regulatory impacts: Geopolitical tensions, tax incentives, regulations, and restrictions on ICE car usage could cause a fundamental industry shift. 

Power balance between automotive players: The role of mobility providers is increasing, and car manufacturers (OEMs) and dealers are beginning to act as fulfilment partners. 

Ownership to usage: Customer demand is shifting to flexible, usage-based products, and the industry is learning to adapt. 

Private to corporate ownership: A transition of asset ownership from private to corporate usage-based products is underway. 

Car park uncertainty: Regulations and other external factors are driving change in mobility providers' car park composition. 

Asset management across multiple life cycles: Mobility providers have to deal with managing vehicles through multiple lifecycles, including refurbish, reuse, remarketing, and recycling. 

Downstream services: Demand is expected to increase for integrated services (in-life) along the customer lifecycle. 

Autonomous vehicles: Technological advancements aside, the expectation for growth in autonomous services remains limited for now. 

Digital era: Large technology companies are competing with car manufacturers (OEMs) in the growing market for data-based mobility solutions. 

The cost of inaction by industry players could be fatal, especially in an industry that is moving in so many directions. Forecasts and business models are already showing the impact of the changes taking place in the mobility landscape. But leaders who want to keep up with, or even surpass, their competitors could use more clarity on the road ahead. 

Six key findings of the study:

Mobility providers may need to differentiate their short- and long-term growth strategies. In doing so, they should identify their most promising profit pools that align with their strategic focus. Choosing the right areas in which to engage could help determine their future success and the role they might play in the future automotive mobility sector. Mobility providers should consider focusing on six key takeaways from our study:

  1. Position your company in the automotive mobility value chain today to help secure your future as an automotive mobility leader in 2035. 
  2. Master your asset management across the value chain and multiple vehicle lifecycles. 
  3. Focus on and invest in growth-oriented profit pools. 
  4. Develop and use mobility platforms and mobility budget offerings to sell your own and partner products. 
  5. Pursue decarbonization to meet the 1.5 degrees Celsius climate target. 
  6. Keep an eye on the medium- and long-term development of autonomous vehicles and fleets. 

For more information, download the full report here, or connect with us to discuss implications for your strategy.


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