By Courtney Reilly, Customer Value Manager
Transportation has been taking center stage in the tech scene lately.
From Columbus, OH, using their federal grant to bypass light rail technology and invest directly in driverless technology, to the Paris Airshow where the newest Boeing airbus technology took center stage, recent transportation industry news reads more like science fiction than actual news.
But, as with all progress, there is fear of change and uncertainty of the future. Elon Musk continues to caution against the blind adoption of AI, while affirming that autonomous cars will be available to the public in the next five years. As e-retail becomes more economic for customers and retailers alike, industries like the automotive aftermarket must be ready for coming changes and dealing with those already underway. Here are three examples of how the automotive aftermarket industry is being disrupted. Hold on to your hats.
1. Self-driving Vehicles (SDV) & AI Technology
If you’ve been online at some point in 2017, you’ve probably seen at least one article touting the destruction of the automotive aftermarket via driverless technology. While the future is intriguing and uncertain, the automotive aftermarket will surely survive—maybe even benefit— from adopting this new technology. Driverless cars still need to be created and sold and maintained, and increased interest and production of affordable personal autonomous vehicles means a surefire uptick in the market. This kind of change to the standard automobile design is unprecedented, and the aftermarket will reap the benefits for years to come, especially as public transportation adopts new forms of technology.
Oh, and if you’re expecting the first widely available autonomous vehicle to be produced by current industry dominators like Uber, Tesla, or Google, think again. Look to the OGs of the car business for your first self-driving minivan.
2. Increased Popularity of Fixed Light Rails
As city populations increase, city infrastructures are growing and changing at a rapid pace.
While implementing light rail technology would be a vast improvement for most city transportation systems, a few cities are seeing the merits of waiting to invest in improved single autonomous vehicle technology. Columbus, OH is using the transportation improvement money they won from the federal government to leap-frog cutting edge light rail technology in favor of investing in driverless vehicles as a form of public transportation.
Cities experiencing explosive growth (shout out Nashville) will benefit from implementing rail transportation infrastructure, as their infrastructure is struggling to keep up with the population boom. Cities like Columbus, who are growing, but at a less frenzied rate, will see greater benefit from waiting to invest in autonomous vehicles.
In the end, the right transportation option for a city depends on population size, sprawl, and growth rate. But one thing remains certain: as our population continues to grow, changes are being made.
3. Rise of eCommerce and Direct Selling to Customers
With globalization running full speed ahead, the global aftermarket is trading more fluidly, with increasing amounts of commerce being done digitally.
After the initial success of Chinese platform TMall.com this year, companies like Goodyear and Michelin are investing in digital commerce, i.e. acquiring online selling platforms. Smart automotive aftermarket companies are looking to the success of Amazon and other online retailers to inform their new distribution strategies. The distribution process reaches further than ever before, stretching all the way to the customer, so convenience and logistics are becoming the top priorities for sellers. Giving more direct buying power to the customer changes the game for B2B and B2C companies, especially as China pushes to penetrate the U.S. aftermarket.
As the automotive and aftermarket environments become more digitally disrupted, American brands and retailers will need to adjust to survive. To retain positive status within the market, companies must be quick to adopt new technology and know when to adapt their business model for digital commerce. In this new future where Google is racing to catch up with automotive giants like Ford and Toyota, and Michelin moves their tires to the web, reality seems stranger than fiction, and nothing is off limits.
To hear more from Courtney, check out her LinkedIn.