Article

On-Demand Car Features

Features on-demand – a new era of customer value creation 

Data-driven business models built around on-demand car features (ODCF) are opening up new paths to growth for the automotive industry. The business case for ODCF options is extremely attractive. However, OEMs will have to develop and launch a wide range of processes along the value chain to succeed, including meeting compliance requirements, software update management and enhancing the vehicle architecture.

OEMs need to adapt a wide range of processes in order to successfully implement ODCF, while also considering the associated risks. But before they can even begin to orchestrate such a complex exercise, they need a standardized, fully-featured hardware platform with a focus on software / service capabilities and on-demand car feature potential. It is vital to address hardware contingency issues in this context, for instance the trade-off between a higher price tag for fully featured hardware and cheaper operational costs due to reduced complexity in production.

One thing is certain, the days of carmakers as mere hardware manufacturers are numbered. In recent years OEMs have begun to offer more and more digital services. We presume this trend will continue as we expect new usage and payment models to hit the market. With on-demand features ranging from augmented reality head-up displays (AR-HUD) and intuitive safety features to infotainment services or advanced battery management solutions, the sky is virtually the limit.

If OEMs are clever about playing the digital card and developing compelling ODCF options, they will be able to capitalize on the very trends that are threatening their conventional business models. Shared mobility, for instance, stands to benefit considerably from ODCF; as customers move from ownership to sharing, they will appreciate having an individual profile that can be activated in each car they use in the sharing model. However, as the amount of vehicle data continues to increase, it is essential for carmakers to take a holistic approach to their technology architecture for the car as a platform (CaaP) to succeed. The challenges are far from trivial. Carmakers will need to be cautious when it comes to data security and compliance and deal with various implications along the value chain. The most critical success factor will be finding the right pricing strategy for these new business models to be sustainable and validating the same with real life customers.

Make sure to read our ODCF Whitepaper, detailing our unique Deloitte Operating Model here.

Whitepaper "On-Demand Car Features: Readiness for a new era of customer value creation"

The process landscape and Deloitte Services

Our newest paper looks into the most important aspects OEMs need to consider in order to achieve readiness for a new era of customer value creation, including a deep dive into regulatory requirements. Read the paper here.

Assessment of the OEM’s readiness for On-Demand Car Features along the business, product, operations and technology dimensions

Contact our team to learn more:

Isabel Vimbai Makwara Gora
Senior Manager | Risk Advisory, Automotive
+49 151 54483643
igora@deloitte.de

Ritika Kochar
Manager | Risk Advisory, Automotive
+49 151 54484862
rikochar@deloitte.de