• E-Commerce vehicle sales rise year-on-year as the pandemic reshapes consumer attitude to “digital-first”
• More Carmakers Copy Tesla’s Online Car Purchase Playbook

Online car purchases fueled by e-commerce rise, enabling tech for a better shopping experience & COVID-19 impact

The pandemic is pushing carmakers and auto dealerships to rethink their digital retail channels and accelerate their online e-commerce offerings to enable more consumers to purchase cars online.

“By the end of this year, you’re going to see 80%-90% of U.S. new car dealers with full e-commerce capability in their shops” to handle everything online but the test drive and — maybe — the final signature”

Rhett Ricart, the former chairman of the National Auto Dealers Association (NADA)

Understanding the challenges and the purchasing criteria of today’s connected customer

But the challenges and the purchasing criteria of today’s connected customer differ from the previous times. Product specification, device interoperability, Connectivity, Content/service availability affect personalised shopping experiences. In this direction, major carmakers are collaborating recently with digital retail providers in order to digitalise their sales platform (and/or their dealerships platforms) and enhance consumer’s accessibility to purchasing vehicles online.

A recent example is Tekion’s EV-focused retail software for GM’s dealers. Tekion will provide GM dealers with its retail management software that will make it easier to purchase a Chevy, Cadillac, Buick or GMC brand electric vehicle. According to the company’s announcement, the new Tekion software can process a large portion of a vehicle transaction online, making it simple for customers to search for and buy an EV. GM, alongside Renault-Nissan and BMW, was an early investor in Tekion, which is now valued at over $1 billion.

Enabling Technology: Digital & mobile-first, AR/VR

Competition in Online Car Purchase Business model

In the US, one of the largest car and online sales markets globally, the number of automakers that provide sales through their own digital retail platform is relatively low. Major automakers such as Daimler, Hyundai, BMW, Peugeot, Porsche and Citroen among others have already created sales platforms on their official websites in order to sell their vehicles online. But the vast majority of them involve active dealership participation in almost every aspect of shopping procedure – from vehicle pricing based on existing demand and existing inventory in stock to the signature and the delivery of the purchased vehicle.

Tesla has a substantial lead over Ford and GM, even though lately the two auto giants have made moves in Tesla’s direction.

Tesla is targeting direct online car purchases and service, not franchised dealerships

Tesla continues to adjust its retail operations and product offerings (deliveries to customers’ homes and workplaces, touchless deliveries etc.) in order to optimize customer experience.

“We are targeting with Model 3 and Model Y, a global mass demographic with a broad range of potential customers” .

Tesla’s Annual Report, 2020

FCA Group enhances Online Retailing Experience

FCA has built a digital retail platform that allows customers to complete the entire vehicle purchasing process online, including pricing information, options for financial lending, e-signature and in some cases home delivery. E-Shop is accessible through the Chrysler, Dodge, Jeep, Ram, Fiat and Alfa Romeo websites.

“Shop, Click, Drive” provided by General Motors, aiming to boost the online purchase cycle

“Shop, Click, Drive” allows users to obtain certain GM vehicles (Buicks, Chevrolets and GMCs) through GM’s dealership network and complete a portion of the transaction online. The service became particularly popular in the wake of the pandemic- according to GM’s announcement dealers have seen a five-fold increase in the number of sales leads they are getting from the “Shop. Click. Drive” service.

Mustang Mach-E retail platform for online car purchases

Ford’s online platform enables Mustang Mach-E orders: By this application, Ford enables customers to create their preferred vehicle configuration of Mustang E and complete their payment online. Additionally, Ford has recently launched a new digital platform for used-vehicle sales, branded Ford Blue Advantage.

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• Free-Floating Car-Sharing Fuels Growth to the German market

To learn about Carmakers’ strategies, market positioning and leadership in MaaS read our report “Carmakers’ Competitiveness in Smart Mobility“.

For more information on this report, including sample pages and a full Table of Contents, please contact us on (+44) (0)20 3286 4562.

Car-Sharing in Germany bounced back in 2021. Both the number of customers and fleets are increasing steadily in Germany.

The evolution of Germany’s car-sharing market is a key metric for the rate of consumer transition from car ownership to Mobility-as-a-Service in Western Europe’s leading car market and one of the top hubs for autonomous, electrified and shared mobility. It also paves the way to the future of mobility with Robo-taxis, Robo-shuttles, aggregate mobility providers and Urban Air Mobility.

The successful execution of leading carmakers’ Smart Mobility strategies in their domestic market is crucial as they cannot afford to miss out on the new revenue pools against new Mobility Service Providers.

The evolution of Germany’s car-sharing market

Germany’s car market was hit hard by the pandemic, with new car sales down by 19.1% in 2020 according to ACEA.

To capture how COVID-19 might have reshaped consumer sentiment towards car ownership and the use of mobility services, a survey by LeasePlan unveiled that 60% of the respondents in the country intends to buy or lease a new car in the next 5 years. Almost all respondents in Germany have access to a car by the end of 2020.

LeasePlan

Car-sharing subscribers rebounded in Q1 2021, while the vehicle fleet continued to grow

Similarly to the hurdles Germany’s auto market faced in 2020, the domestic car sharing market witnessed a slowdown in 2019 but managed to rebound quickly at the beginning of 2021. As of January 2021, there were 2.874.400 registered customers across 228 car-sharing schemes in Germany’s 855 cities and municipalities according to BMWI.

In 2020, the number of subscribers contracted by 6.9% to 2.29 million year-on-year but Q1 2021 saw a positive trajectory up by 25.5% y-y. The disruption in growth was attributed to the drop in the number of users of Free-Floating services in 2020 as compared to the year before, but the first few months of 2021 saw users return to car-sharing.

Germany’s Car-Sharing market rebounded in 2021

• The number of customers in Germany has more than doubled in the last 5 years, recording a CAGR of 16% between 2016 and 2020;
• Free-Floating services account for the largest share in both vehicle fleet and customers of car-sharing schemes in Germany;
• The Car-Sharing fleet in Germany grew with 26% AGR in 2020 recording a CAGR of 12% between 2016 and 2020;

Free-floating car-sharing accounts for the highest share in both users and vehicle fleet

In the free-floating car-sharing market segment, the number of users rose by 36.1% in the first three months of 2021 compared to 2020 reaching 2,150,300 users. Free-floating car sharing, in which the vehicle is picked up using a smartphone app from where the last customer left it, is growing on the existing space, mainly in the large metropolitan regions, such as Berlin and Munich. Free-floating providers offer car-sharing services in a total of seven large cities and the metropolitan areas around them. As for 2020, there were no new locations added.

e-Car sharing penetration rose to 19% in 2021

The share of battery-electric vehicles and plug-in hybrids in the German car sharing fleet is, as of Jan. 21, roughly at 19%. All alternative drives (battery electric, hybrid, plug-in, hydrogen fuel cell, gas hydrogen) combined made up around a quarter of new registrations in 2020.

Nevertheless, in the national car fleet the proportion of emission-free vehicles stay relatively law, only 1.2 percent (0.5% in 2019). The take-up of electric vehicles has been slow in Germany compared to many other European markets (i.e. Norway & Netherlands) despite huge government incentives.

Electric car penetration in Germany, which include Battery Electric Vehicles (BEV), Plug-in Hybrids (PHEV) and Fuel-Cell vehicles (FCV), accounted for 14% of new car sales in 2020, according to ACEA.

Carmakers Vs. emerging competition

The number of car-sharing businesses, cooperatives and associations has remained fairly stable in 2020 as compared to 2019 to 288 schemes. Germany’s top carmakers are particularly active in car-sharing in their domestic market, particularly BMW, Daimler and VW Group through their Joint-Ventures and subsidiaries.

The Free-Floating car-sharing market is dominated by the four large providers ShareNow (a JV between Daimler and BMW), Miles, Sixt and WeShare (Provided by VW Group).

Share Now is a Free-floating car-sharing service. In 2020, around 2.9 million customers used the SHARE NOW car-sharing services, which are available in 16 cities and eight countries. The car-sharing fleet currently comprises around 9,500 vehicles, almost one-quarter of which are electrically powered

Daimler with Car2Go has been a leader in B2C Car-sharing and in 2019 announced a deeper strategy shift to focus on mobility with its restructuring. Also, it has announced an alliance with BMW Group to merge their mobility services business units and offer customers a single source of urban mobility. Each company holds 50% of the new joint venture.

VW’s WeShare is now available in Berlin and it recently expanded to Hamburg.

Paving the way to robo-taxis & Urban Air Mobility

Robo-taxis hold strong potential to revolutionize mobility. For carmakers, Robo-taxis present significant opportunities, such as amortizing the cost of the sensor set needed for higher autonomy before they can be brought into series production for private cars.

Apart from the automotive industry, a series of industries will experience the benefits of Autonomous Mobility in terms of cost savings and new revenue opportunities. For example, carmakers and mobility providers could see revenues from autonomous car-sharing and ride-sharing grow rapidly as well as from private car ownership due to the transformed role of the car as the “3rd living space” due to increasing productivity.

…”Station-based and free-floating carsharing leads to a reduction of private cars but to different degrees (DriveNow 7%; Flinkster 15%). The shedding of cars is influenced by the frequency of use of carsharing and the increasing membership of station-based carsharing providers”.

The Impact of Carsharing on Car Ownership in German Cities (2016)

Finally, Urban Air Mobility, which offers a new way to commute to work and transport goods using electric vertical take-off and landing aircraft (eVTOLs), is expected to be launched soon in German cities by players such as Munich-based start-up Lilium and Daimler-backed Volocopter.

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To learn about Carmakers’ strategies, market positioning and leadership in MaaS read our report “Carmakers’ Competitiveness in Smart Mobility“.

For more information on this report, including sample pages and a full Table of Contents, please contact us on (+44) (0)20 3286 4562.

• Cloud-based development of ADAS promises scalability, efficiency, security, and staying always up to date to guarantee that today’s systems will mitigate future accidents in the ever-changing road environment
• Data-driven and Software-defined cars and Mobility Services could see accelerated deployment by 2025
• The role of Cloud computing providers is increasing

4 benefits of Cloud-based platforms for ADAS development

By 2030, 67% of vehicles sold globally will have at least level 2 and 3 autonomous driving capability. One quarter will have level 4 and under 5% will have level 5 full automation capabilities.

1. Up-to-date and robust models to mitigate future accidents after SOP

Cloud and OTA-based architecture can provide augmented robustness to traditional validation of ADAS and higher-quality ADAS models by identifying and rectifying failures after SOP with SW patches. Data generated from radars, cameras lidars, and other embedded smart devices can be processed using cloud platforms and the improvements can be used immediately.

2. Software for ADAS is becoming increasingly complex

Vehicle-to-Cloud-based ADAS can simplify the development of automated driving functions by managing accumulating data volumes such as traffic data from vehicles and simulation data.

3. ADAS must be developed in ever shorter cycles

ADAS Sensor data can be processed using cloud-based platforms to enhance the efficiency, safety and security of self-driving vehicles.

4. V2X will rely heavily on cloud-based computing

Vehicle-to-Cloud (V2C)-based ADAS can achieve safe and secure data exchange between OEMS, suppliers and others.

Leveraging a Digital twin for Vehicle-to-cloud (V2C)-based ADAS

Carmakers are already starting to work with cloud computing providers for a variety of application segments—including software development platforms and SaaS. I believe this trend will continue and accelerate in the next decade.

• Amazon Web Services holds a strong position in this domain counting Lyft, TuSimple, HERE, Toyota Research Institute, and nuTonomy among its clients. In Feb’21, Torc Robotics, Daimler Truck’s subsidiary, announced the selection of Amazon Web Services (AWS), Inc. as its preferred cloud provider to handle the scale and speed needed for data transfer, storage, and compute capacity as the company prepares to deploy its fleet of L4 test trucks in New Mexico and Virginia.
• Microsoft Azure is also being used by carmakers such as VW (Feb’21), Ford, and Cruise (Jan’21) among others.
• Other notable players include IBM, Google, Alibaba, Tencent, Dell, Harman, and HERE.

Read more

1. Five New Revenue Pools for Automated Mobility
2. Three Takeaways from Top Suppliers’ ADAS Revenues in 2020
3. 21% of new cars to be highly-automated in 2025
4. Top-12 technology partnerships in Connected & Automated Driving in 2020
5. TOP-5 new changes in 2021 transforming Autonomous Driving

Read our reports to understand the strategies of major Suppliers in ADAS sensors, AD platforms as well as collaborations. Our reports also provide an in-depth analysis of how the regulatory framework affects the OEM strategy for Level 3 deployment.

• 30 Carmakers’ Roadmaps in Automated Driving up to 2025.
• ADAS Suppliers Rankings & market shares 2015-20
• Auto2x Perspectives: Automated Driving 2025
• “Intelligent, Autonomous & Secure Car” report portfolio

For more information, please contact us on (+44) (0)20 3286 4562 or info@auto2xtech.com.