Imagine a world, where cars are looking for passengers and deliveries for revenue

As we approach Webit.Festival our team is starting series Q&A with our speakers. We are presenting you the first sessions with Alexander Renz, who will speak during the Mobility track of our Smart Cities Summit.

As Managing Partner at New Mobility Consulting, Alex Renz helps corporations, startups and investors take advantage of the opportunities emerging from the digital transformation of transportation and mobility, or New Mobility for short. He explores the transformative impact of connected vehicles, autonomous driving, electric mobility and on demand mobility services and fosters cross-industry collaboration across the emerging New Mobility ecosystem.

How will big automotive corporations cope with the changing world of mobility?

The Automotive industry is facing challenges on multiple fronts.

The shift towards electric mobility will make decades of engineering know how in building combustion engines obsolete. It will also require a lot less workers to build electric vehicles, both at the original equipment manufacturers (OEMs) and at their supplier networks.

The other big changes are connectivity and the vehicle as part of our digital lifestyles. Consumer experiences and data-driven business models will become more and more important, both things that the incumbents are not very good at.

But the biggest changes will emerge from driverless vehicles. We believe that driverless cars will have the most profound impact, not only on the car industry itself, but smart cities and real estate, public transport and insurance carrier to name a few.

When will we see the full-scale influx of self-driving vehicles?

The industry is making fast progress towards Level 3 and Level 4 Autonomous Driving, but it will probably take longer than most people expect before we have full Level 4 (NHTSA) automation where no driver is required at any time and the system can handle all driving situations autonomously.

However, with Level 3 we will see vehicles that can drive in a fully automated fashion without the need for a driver in defined use case scenarios. The most likely initial scenarios will be around trucks on highways. For the foreseeable future a driver will steer the truck as soon as it gets off the highway. The other big initial wave will likely be ride hailing, driven by players such as UBER and Lyft as well as the OEMs themselves, who transform into Mobility Services providers.

Even though several OEMs have announced fully autonomous production vehicles for ride hailing by 2021 it remains to be seen if that will happen. Especially in cities there are a myriad of driving situations that will challenge the capabilities of robot cars. As much as I am optimistic that these challenges can be addressed, there are regulatory hurdles that need to be overcome.

How can the industry monetize the wealth of data generated by connected and autonomous vehicles of the future?

Vehicles today are already loaded with sensors that generate massive amounts of data. However, until now the use of these sensors was focused on optimizing the internal functions of the car. Autonomous, connected vehicles will gather a lot of information about the vehicle itself, but also the driver and the environment. The debate as to who owns this data is still ongoing. There are huge data privacy implications and especially the German OEMs are very sensitive to protecting their customer’s privacy.

The big challenge for the industry is to develop relevant services that create brand loyalty and consumer engagement. Building relevant, contextual services is difficult, but even harder will be to build services that enough customers are willing to pay for to really matter for OEMs. The Internet services players will have a big advantage here, since their existing services easily translate into the driverless vehicle.

I believe that OEMs have a great opportunity if they can manage to combine engineering with digital competencies. They need to learn to design great user experiences and develop data science expertise to harness the data generated by the vehicle. In my view the car will need to become a platform for an ecosystem of services providers, much like we know it from mobile phones. Unfortunately they have relied heavily on suppliers and have given up to much control over what becomes a key strategic battleground.

Today’s connected car platforms are legacy technology and the mindset of OEMs continues to be that of a closed system. But there are interesting startup emerging that empower OEMs to develop new business models and increase agility without compromising on security and compliance.

What is the most significant technology that will shape the future of mobility in your mind?

If I had to pick a single exponential technology, I would say Artificial Intelligence in view of its importance for both automated driving, and digital assistants. However, ultimately it is not about a single exponential technology, but the convergence of technologies such as smart sensors networks, artificial intelligence and autonomous robotic systems.

We envision a world where robots such as cars become their own economic agents and will look for passengers and deliveries to generate revenues. Smart contracts on the blockchain will enforce maintenance and insurance policies, govern fares and pay taxes based on actual for road usage. In such as Machine-to-Machine (M2M) economy we will have autonomous vehicles transact with charging stations and other network participants without human intervention.

We need a next generation Internet to enable such networks to scale securely. We believe the blockchain has a big role to play in this next generation Internet. It provides a trusted, network-based identity, but also as an asset management and transaction layer. In many ways the blockchain will enable IoT, autonomous robotic systems and artificial intelligence to take us into the future of mobility. That is the core of my session at Webit.Festival in Sofia.


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