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Automotive Technology - Way Forward (Ver1)

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Ideas for making automotive technology more user-friendly and value-added.

Published in: Automotive, Business, Technology
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Automotive Technology - Way Forward (Ver1)

  1. 1. Automotive industry: technology vs. customer value Achal Raghavan Strategy & Business Excellence Consultant Bangalore, India achalraghavan@yahoo.co.in www.achalraghavan.com 1
  2. 2. Achal Raghavan: introduction  IIT Madras (1973); IIM Ahmedabad (1977)  30+ years of work experience  10+ years at Board level  Companies: L & T, Anand Group, Sundram Fasteners, Delphi Automotive, Ingersoll- Rand  Now: Teach, consult, write 2
  3. 3. Contents  Automotive technology: current status & trends  Aerospace to automotive: technology osmosis  The tipping point  Customer needs in developing markets  The way forward 3
  4. 4. Automotive technology: current status & trends  25% of cost of modern car (Europe/US) is electronics and software; projected to grow to 40% by 2020  Electronics expected to drive 90% of future innovations  Industry focus shifting to need for “dependable electronics”  Software defects costs rising at 17% CAGR 4
  5. 5. Automotive technology: current status & trends (contd.)  Car prices constant between 1990 and 2004 (adjusted for inflation)  Customers increasingly rate “safety” as most desirable feature of vehicles (JD Powers)  Models proliferating: 20 models/brand in 1994; grown to 34 in 2004  Beginnings of backlash against complex technology –”computer rage” 5
  6. 6. Aerospace to automotive: technology “osmosis” Technology “osmosis” 6
  7. 7. ABS – from aerospace to auto Originally developed to assist in landing heavy aircraft 7
  8. 8. Heads-up display F/A-18C jet fighter Wikipedia 8
  9. 9. Heads-up display Chevrolet Corvette Wikipedia 9
  10. 10. GPS / HUD – aerospace Integrated Primary Flight Display Honeywell Honeywell Runway Awareness and Advisory System 10
  11. 11. GPS: automotive navigation Stand-alone Navigation Systems (for cars) 11
  12. 12. US DoT 12
  13. 13. US DoT 13
  14. 14. 24X7 connectivity GM OnStar • Safety, security, convenience • Vehicle diagnostics • 24X7 connection to Advisor 14
  15. 15. Airbags – from auto to aero! 15
  16. 16. Aerospace vs. auto: comparison Aerospace Automotive  Highly trained and  User is an average expert pilot citizen  State of the art  Service backup still service backup “iffy”  Techno-savvy  Highly competitive buyers  Communicating  Limited competition “value” difficult  Less sensitive to  Highly price- price sensitive 16
  17. 17. The tipping point ? “Tipping point” ? Customer enthusiasm Fascination Frustration Technology 17
  18. 18. Class discussions  What are the pros and cons of this technology trend?  What does the “emerging market” customer really need? What is “value”?  What is the way forward? 18
  19. 19. Customer needs in emerging markets – finding the balance COST LIFESTYLE SAFETY CONVENIENCE 19
  20. 20. The way forward: some ideas  Offer basic platform which is a cost- effective amalgam of technology and value  Empower the customer with “build your own car” menu:  Customer chooses add-ons  Incremental costs for technology clearly known  Replace “tech transfer / localization” with “design for local” 20
  21. 21. Thank you! 21

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