Day One of TU-Automotive Europe 2015

Anyone still waiting for the tipping point for the advent of the autonomous car can now relax: it has passed. Proof was provided by the more than 1,100 representatives from every sector of the automobile ecosystem that packed the Stuttgart’s ICS Messe on Monday, the first day of the two-day TU-Automotive Europe 2015 conference.

The question no longer is if cars will drive themselves – they do already, to some extent – rather, conference participants and presenters were discussing how the evolution to full car autonomy is best achieved and how it will transform the business of making automobiles and the way people use them.

In his eye-opening presentation, Peter Hardå, Drive Me function developer at Volvo Cars, demonstrated just how close the autonomous car is to becoming a reality. As part of its Drive Me project, Volvo will unleash 100 fully autonomous vehicles on a well-travelled ring road in the Swedish city of Gothenburg in 2017, to help achieve its stated goal of developing ‘self-driving cars for sustainable mobility'.

The stretch of motorway chosen for this pilot project covers about 50 kilometres and, Hardå said, was chosen because it presented few potential difficulties. “There are no traffic lights, no oncoming cars, very few pedestrians and bicycles.”

In addition, the cars will be driving “very carefully and keeping a greater distance from other cars than they normally would”, he said. Their maximum speed will be 70kph and a driver will be present but will not need to supervise.

“The driver will be completely out of the loop,” Hardå explained. “The vehicle must handle all situations.”

However, in case a situation develops which the car cannot handle or some other problem arises, the car has a fail-safe response. “Whatever happens, the vehicle must make a safe manoeuvre and go to a safe state,” he said. “This means it will be stationary and permanently braked, perhaps at the side of the road. Here we give control forcibly back to the driver. You need to drive the car away.”

The cars will of course be equipped with a broad array of sensors and cameras, including a trifocal camera with one lens focused on pedestrians running between cars. Perhaps just as important, it will have features that promote driver interaction, such as a function that shows how the vehicle sees the environment. The purpose of this feature is “to promote trust”, Hardå said.

This is a major objective, because what good is building a perfectly functioning autonomous car if no one will buy it? That was the topic of a fascinating panel discussion, titled “Automated Driving’s Biggest Battle: Consumer Acceptance”, which preceded Hardå’s presentation.

As Chris Reeves, commercial manager, Intelligent Mobility and Future Transport Technologies, at Horiba Mira, put it: “Without public confidence and consumer acceptance, we will not be able to build a viable business case.”

According to the independent consultant Holger Meinel, who was in the audience for the discussion, a recent study showed that, while 90% of Brazilians want to have a self-driving car, only about a third of all Germans and just a bit more than a quarter of Japanese feel the same way. This suggests that, despite what Walter Hagleitner, consultant at ADAS Management Consulting, called “all this autonomous car hype”, many consumers who can actually afford to purchase an autonomous car still need to be convinced that they should.

Reeves suggested that one problem is confusion about just what an autonomous car really is and does. “It’s critically important not to confuse the consumers and the public,” he said, and went on to say that the terms ADAS, connected and autonomous are often used interchangeably.

“There’s a confusion about their meaning, which is not good for consumer acceptance,” Reeves declared. “Users have to understand when and how to use these systems.”

Hagleitner agreed, saying: “We did not understand why ADAS was not taken up more quickly. It was because people did not understand it. But when they tried it, they liked it.”

Moritz von Grotthuss, CEO of Gestigon, said that attention must be paid to what a person does in a driverless car. “It’s an experience. The real question is, are we open to consumers? If a consumer has a self-driving car, he or she would get bored. We have to understand how they are sitting or moving in a car when they are not driving. If we understand this, we can provide the best user experience for that car.”

According to Reeves, that includes making the systems “completely intuitive to consumers”, a solution he described as being “simple and straightforward but difficult to implement”.

Grotthuss pointed to the ads used by Apple when it introduced its iPhone by showing a boy using its features, which made it appear to be “so easy to use that a kid can use it”, and so also served as a tutorial to consumers on how to use the new product.

In his presentation, which followed the panel discussion, Volvo’s Hardå suggested that the best way to overcome consumer reluctance to accept the self-driving car was to launch the entire package from the start, rather than offering it piecemeal. “Providing a fully self-driving car is a better offer to customers, instead of a car that only partly drives you,” he said.

Perhaps the key to luring consumers to the technology lies in, as Grotthuss put it, “offering an experience to the user”– that is, transforming the car from a mere conveyance to a part of a consumer’s digital lifestyle. In a panel discussion about “Connected Cars and Future Mobility – New Alliances, Standards and Ecosystems,” Martin Kristensson, director of Connectivity Strategy at Volvo, noted: “Most consumers spend only one hour a day in their cars and only one hour away from their phones. If Google and Apple can provide good solutions for the car, it’s good for our customers and therefore good for Volvo.”

In other words, consumer acceptance for the autonomous car may not be dependent on how the technology is presented when it is launched but rather how carmakers shape the in-car experience for the consumer now. If the connected car is regarded as a part of the customer’s digital lifestyle, he or she could view autonomous technology as an extension of that experience.

Without expressly addressing that issue, representatives of two cutting-edge German carmakers, BMW and Mercedes, presented strong arguments for using the digital experience to create customer loyalty, which ultimately can lead to customer acceptance of new and disruptive technology.

“The nice thing about digital services is that it opens further value pockets,” said Stefan Butz, vice-president of Location-Based Services at BMW. “That can be everything, from entertainment, mobility, commerce and insurance.” And so why not also autonomous driving?

Butz called touch points “the secret source of moving to digital”, going on to say: “You can only create loyalty and monetize the digital experience if you create further touch points. A good touch point is a combination of content, of hardware and of the device where you access the content in a very user friendly and sophisticated way.”

Significantly, Butz cited Apple as a model for creating high customer loyalty because of the number of its touch points, such as a “nice design”, the wallet function, an email account, iTunes, the Apple user ID and the Apple cloud function.

“Once you have adapted to these touch points, you need a significantly better alternative to change [brands],” he said.

BMW is “strongly thinking about digital services, engagement through digital touch points”, Butz said, “but you can easily combine automated driving and digital services. This is why BMW has organized these in one division.”

In the day’s closing keynote presentation, Christoph Hartung, head of Connected Car at Mercedes-Benz, also proposed offering a digital experience to the consumer as a way of making the connected car attractive to the end user. “The question is: what do we have to do to be in the relevant set of your customers?” he said, and declared: “Everything you do starts and ends with your customer.”

Other vital questions that need to be considered in his view include:

·         How can we build the digital customer journey?

·         How can we deliver emotion and a seamless integrated environment?

·         How advanced are we in understanding the digital business? and

·         Is it the Googles and Apples or is it the vehicle [that provides the answers]?

Hartung’s response to the last question was, “I think it’s both,” and advised carmakers to adopt “a way of thinking in all-day terms of what a customer really needs”.

He also advised them to accelerate their digital business and “embrace the whole mind-shift”, as his company has done with its Mercedes Me solution, because “inside the vehicle is one of the most valuable touch points we have”.

The first day of the conference was also marked by an announcement by Daimler and the telematics service provider WirelessCar about their new partnership. “Starting in 2016, Daimler will utilize WirelessCar platform services to extend the service offerings to business-to-business customers with fleet management services, including location and vehicle follow up, and extensive reporting through portals and mobile apps,” the statement said. “The solution offers complete fleet services but is also designed with multiple APIs allowing for efficient integration with various ERP systems.”

If the words autonomous and self-driving were the words one heard most often during the day, Apple and Google were not far behind. The two IT giants are increasingly viewed as models for attracting and retaining customers and as potential partners for carmakers looking for a similar success but also as possible – perhaps even inevitable – competitors.

As Butz said: “We are facing exponential growth, which makes the market highly attractive, which also leads to the situation that new players, new competitors, crop up. We now see new companies entering this industry. Interestingly, the majority of these companies are asset-light, so they come in with data-based business models, not with tons of infrastructure, so the type of competition will be totally different and I think the industry boundaries are going to blur. Also, consumer behaviour is adapting accordingly.”

He then showed results of a survey that suggested that consumers could be willing to switch to a brand that offered a better integration into their digital lives. In other words, Google and Apple are increasingly being seen as threats. Or, as Jan-Maarten de Vries, vice-president of Product Management and Marketing at TomTom, put it, “Ultimately, it’s a battle for the customer between traditional [car] OEMs and these companies.”

He was speaking during a late-afternoon panel discussion ominously titled Standing Tall Against Consumer Electronics, which explored the means by which carmakers could exploit CE services without losing control of their business models. De Vries described the dilemma as follows: “How to offer something like Apple Car Play while binding the customers to your user experience.”

He said the tension arises out of the fact that Google has different strategic interests than the carmaker. “They don’t want to help them make more business.”

Massimo Cavazzini, Global Uconnect – EMEA head of Product Marketing and UX, at Fiat Chrysler Automobiles, admitted that his company’s cars have both Car Play and Android Auto but said that it was a winning offer. “We are adding something but not replacing the car experience.”

However, Scott Frank, vice president of Marketing at Airbiquity, warned that such a partnership could spell trouble for the carmaker. “Eventually, Google and Apple will be competing with the carmaker for the car platform itself.”

However, he added that “vehicle-centric apps and services will surround and probably outnumber smartphone apps. That will be a branded experience.”

And Akos Bagladi, Business Development Manager at NNG, said that end users are increasingly requesting predictive functions such as Google Now. “If Google and Apple have the data, they will use it for their own purposes, which is selling ads. Owning and controlling this profiling data is the key.”

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