90 minutes on the connected car
Published on 09/03/2016 in Inspire
Seen rationally, a car should enable you to move around efficiently and comfortably. However, the connected car takes us into a new era. The car is developing into a digital hub on wheels. This is causing a radical shift in the sector, with opportunities for totally new business models.
The concept is not really recent. We phone from the car, the satnav is connected to satellites and tracking systems register routes and driving behavior. But now, something fundamental is changing. Not only our smartphone, but the car itself is permanently connected to the Internet. The availability of data on cars, traffic flows and infrastructure creates new possibilities, such as advanced traffic information for the driver and online entertainment for the passengers. The car produces data itself, on the working of the engine or the need for servicing, and keeps up-to-date information on distances, driving times, consumption and so on. This development is bringing radical change to the entire sector. New information means new insights. They, in turn, lead to new services and models from manufacturers, garage owners, leasing companies, insurers, etc.
Reflection of daily life
The spectrum of the connected car is very broad: from the car with the built-in SIM card to the self-driving vehicle. “The essential thing with every type of connected car is the possibility of connectivity and data exchange,” says Joost Vantomme, Director Public Affairs at Febiac, “including traffic information, safety and traffic optimization, among other things, as well as the level of comfort for the driver and passengers.” Connectivity and data exchange lead automatically to the need for broadband – and to issues of data protection and privacy. The striking point in the whole story is that the connected car makes us look at cars differently. “In the past, the cubic capacity of the engine was the main criterion when choosing a car, then the horsepower and today it’s the emissions,” says Jean-Marc Ponteville, PR Manager Volkswagen Belgium at D’Ieteren. “Soon we’ll be choosing a car on the basis of bits and bytes. The car is a tool that reflects our way of life very accurately.” From that point of view, the consumer is driving the connected car market – and not the other way round.
“The connected car offers the entire automobile sector an extraordinary opportunity,” says Stéphane Jacobs, CEO at Mobilefor. “The demand for mobility is constantly increasing. The automobile industry can look forward to another 50 years of growth at least.” The connected car may be an element that helps resolve the current congestion on the road network. In the connected world, data is the fuel for new applications. “Carmakers, highway authorities and public transport companies will have to work together and open up their data,” says Jan Cools, CEO of Be-Mobile. “Through electronic toll collection, among other things, you can guide traffic a lot.” This guiding effect will soon be felt here in Belgium too, namely in freight transport. Eventually, tolls may well be collected from passenger cars, as well. This not only changes the tax system, but also people’s behavior and habits. Open data is becoming so important that Volvo Cars has even hired a data officer.
Although the self-driving car is not yet with us, the connected car already has its place in traffic. “Since 2013, our cars have had a built-in SIM card,” says Jasper Odent, Product Manager at BMW Group. “If there’s an accident, the car automatically contacts a call center.” Via the SIM card, the car sends servicing data to the dealer. The connection also enables real-time traffic information, as well as other online services, including Internet access. Audi, too, now has a second generation of connected models on the market. “Among other things, we offer apps with which the driver can contact the car via the mobile data,” says Edouard de Meulemeester, Network Projects Manager at Audi. “He can look for the location of the car, turn on the heating remotely, etc. The important thing with this type of application is that the focus is on the client: that the client wants a mobility solution.” The connected car – and all the apps that go with it – can offer part of the answer here, for example by guiding the driver to a free parking space. “Since the car contains a SIM card anyway, you could make it a sort of virtual mobility portfolio,” says Stéphane Jacobs. “At the moment we are seeing mainly local initiatives, where you have to link a credit card to every application – in order to park, for instance.” Linking up directly with the connected car would make it possible to lower the threshold for new applications. “What’s more, the manufacturers mustn’t all swear by their own apps” in the view of René Aerts Jr, Corporate Communication Director at Volvo Cars. “It’s not just Belgium that has to provide the necessary infrastructure. We have to open up and cooperate with multinationals like Apple and Google, to integrate the best practices into the car.”
Safety remains a priority for carmakers. “We have to take care that the availability of all sorts of information doesn’t distract the driver from the road,” says Joost Vantomme. An apt comment although, first and foremost, the connected car aims to improve safety. When the car receives data in real time about the cars around it, the traffic infrastructure, the weather conditions and the traffic flows, it will be able to take the right decisions faster than the driver. “The arrival of the 5G network is important here,” says Laurent De Meutter, Head of Sales Mobility at Proximus. “This network not only makes it possible to give priority to certain data flows, but it also excludes latency.” Just a few milliseconds can make a big difference. “We’ll be investing heavily in 5G over the next few years.” If the data transmission is critical for road safety then, of course, there can be no latency or delay in the signal. “At the moment, the connected car mainly provides support for the driver,” says Jean- Marc Ponteville. “Step by step, this role will be expanded.” The main aim here is to make traffic safer. “By 2020, we don’t want any more fatalities in our cars,” says René Aerts Jr. “Smart technology will play a role here.” Over the next few years, trust in self-driving cars will have to be developed. Especially in places where there are few cars equipped with the latest technology.
Privacy and security
If we are talking about safety in the context of the connected car, we can’t overlook the security of the connection and the data. Will hackers be targeting our cars soon? “We attach great importance to the security of the data traffic,” René Aerts Jr. goes on. “That’s quite simply one of the major challenges of the connected car.” As soon as a device is on the Internet, a security risk arises. “Besides data protection, privacy is also an issue. “The car sensors record the driver’s behavior on the road in detail,” says Jan Cools. “That information is very interesting, among other things for insurers.” They would be able to reward good drivers on the basis of recorded data on routes, times and driving behavior – or refuse accident-prone drivers. There’s already an insurance policy like this on the market in the Netherlands. “At the moment, the average client does not consider privacy much,” says Jasper Odent. “Clients seldom ask for the SIM card of the car to be deactivated.”
One other important observation is that connected cars also change the work behind the scenes. Dealers not only need to expand their networks to be able to carry out the updates for connected cars more easily but, as well as mechanics, they also have to recruit staff who understand connectivity and software – in the workshop and in the showroom. “That much is clear among other things when you deliver a new car,” says Edouard de Meulemeester. “The explanation of the connected aspect and the apps now takes longer than the sales talk.” It obliges dealers to invest in training. “It is increasingly becoming a challenge to find staff who can fulfill this changing profile,” says Jean-Marc Ponteville. “The technical costs of the connected car will rise, but so will the dealers’ turnovers. The cost of the mechanical part will continue to fall,” according to Laurence Hamer. Moreover, it looks as if that trend is set to accelerate. “So the profession is becoming increasingly vulnerable,” in Joost Vantomme’s view. “In the past the car was an autonomous machine, but the connected car depends more on connectivity and applications.” So dialogue between all the stakeholders is essential. “We need to know one another’s plans for the future,” concludes Laurence Hamer, “so that, as operators, we can continue to fulfill the automobile sector’s needs as regards the connected car without difficulty.”
The connected car makes driving a totally new experience. As a driver and a passenger, you will have access to up-to-date information and entertainment. Vehicles are getting smarter, so we are moving step by step towards self-driving cars, permanently connected to their surroundings. The connected car changes the whole ecosystem: from the carmaker and the dealer to the leasing company and the insurer.