With disruption becoming a reality and shaping the sector, the convergence of key trends promises for more to come. Together, electrification, autonomous driving, shared mobility, and connectivity are enabling further alternatives than ever while simultaneously infusing more uncertainty.
From an OEM’s perspective, entry barriers have never been lower and the outlook favors consolidation for scale. Tesla along with other similar business models software players and localization potentials, all present imminent threats. The transition will be costly, but change is vital to the segment’s future.
Key uncertainties include:
- How much ICE to include in the production mix?
- How fast can the transition occur?
- What is the lowest cost / highest value option for the transformation?
For recent entrants, the opportunity lies in cost curves, agility in identifying tech enablers and speed of market adoption.
- How fast will regulation respond?
- How soon will the competition catch up?
- How can the disruptor be disrupted?
Policymakers and governments are also looking into the new trends through their economic impact, with key questions raised at a strategic level:
- Should they speed up or slow the transition and how should regulations react and enable?
- What are the short and long impacts of the transition on government revenues and expenditures?
For each of these segments, some decisions are clear cut, yet major value exits in bets.
At Grenoble Partners, we advise clients on how to capture the value of uncertainty, around the future of mobility with a focus on the target tech-mix and how to lead the transition.