2019 DISRUPTERS, DECISION MAKERS AND DRIVERS OF US AUTOMOTIVE INDUSTRY IN - SG Analytics Perspective | December 2019
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DISRUPTERS, DECISION MAKERS AND DRIVERS OF US AUTOMOTIVE INDUSTRY IN 2019 SG Analytics Perspective | December 2019
US AUTOMOTIVE INDUSTRY Leading the race US based automotive counterparts, it’s a long road ahead and manufacturers are focusing on achieving may become a practical choice only after Level 5 automation in next one or two 2025. So what are the OEMs planning years. Currently most of the top players in 2019-2020? Should they focus more have attained Level 2 (partial automation) on AI, Data analytics and connectivity or and Level 3 (conditional automation). should they invest more on technology Electric vehicles are the future, however up gradation and move towards electric affordability and manufacturing cost are vehicles? issues in 2019. The good news is that Some of the early thought leaders have lithium-ion battery prices have come down already started the process in 2019 73-percent per kilowatt-hour from 2010 and investing in adoption of newer to 2018. Though this trend is expected technologies and here are some glimpses to continue till EVs become cheaper of their effort. to buy than their fossil-fuel-powered www.sganalytics.com 2
US AUTOMOTIVE INDUSTRY 1) Daimler, USA To stay ahead of peers, a company has to adopt technology at the right time and welcome disruption. Diamler is one of the early adopters of technology and AI and understands the power of data analytics in today’s context. Looking back in Europe, the company had initiated its data modelling process in Berlin with a heat map to predict in which area the highest potential A-Class driver would buy a car. The company had 100,000 customer records in its database and using AI it actually zeroed down the list to 5,000 potential buyers of an A-Class Mercedes. www.sganalytics.com 3
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Daimler used a combination of AI and internal data and surveys and that was one
analytics to test out their algorithms and of the reasons why they invested heavily
visualizations and validated their in-house and moved to more advanced analytics
predictions combined with deep mining in system in 2019. The company adopted
their datasets. The findings of this process Microsoft Azure (Azure HDInsights and
helped Daimler to build a counter strategy Data Bricks) and “eXtollo” for extensive
plan for customers who already owned an analysis in February 2019. Azure Data
S-Class owner but had high propensity to Lake Store and Azure Data Factory were
purchase an A-Class Mercedes. The result additionally employed to understand the
was increase in sales. supply chain, store data and other gaps in
The company wanted to safeguard it’s their system.
Supporting Services
Identity & Access Mgmt Encryption & Key Management
Azure AD federated with on premise Bring-your-own-key for Data at Rest
Auditing & Monitoring Network Layer Security
Log Analytics VPN Gateway
Security Center Vnet Integration
Application Insights Network Security Groups
Automation/Orchestration DevOps
Azure Automation Visual Studio Team Services
Core Services
Data Science Virtual Machine Data Retrieval Components
Visualization Components API Gateway
Meta Data Components
Tableau@SecureVM
App Gateway
Analytics Components
Azure Data Web Apps
HDInsight
Bricks
Data Engineering Components Batch Ingestion Components
Azure Azure data Azure Data
Push-to-Cloud
Functions Factory Factory
Storage Components
Azure Data Lake Store SQL Data Base SQL Data Warehouse
Source: Diamler USA (2019)
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US AUTOMOTIVE INDUSTRY
The company is expected to use eXtollo process and understand the key factors
platform to develop blueprint rather than that could influence product quality within
focus on a monolithic product. Of late, the each individual process step.
company has been able to interpret user While on one side AI and data analytics are
perception to offer better and personalized now part of the company’s eco-system, the
services for loyal customers. company is also consciously moving away
The switch from conventional to AI from conventional production to electric
platform was initiated in February 2019. vehicles (especially trucks). Based on recent
Earlier, the company was using IBM® announcements by the CEO, in ACT Expo
SPSS® software, to analyze the large California in May 2019, the company is
volume of data obtained in the production investing heavily on electric vehicles.
“
The road to emissions-free transportation is going to be driven with battery-
electric vehicles. I believe the future is electric, says Neilson.
While moving towards electric vehicle is
gaining momentum, the company just
upgraded itself for future complexities of
”Vans, Daimler Buses and Daimler Financial
Services.
data.
a) The Azure platform will enable the
company to migrate data to the
cloud while maintaining enterprise-
grade security.
b) Improve cloud based security
c) Company intends to apply the
power of Azure to convert massive
amounts of data into insights that
will fuel innovation.
The Daimler Group is one of the market
leaders of premium cars and the world’s
biggest global manufacturer of commercial
vehicles, with divisions such as Mercedes-
Benz Cars, Daimler Trucks, Mercedes-Benz
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US AUTOMOTIVE INDUSTRY 2) Fiat Chrysler Automobiles NV Some companies learn from their past and improvise immediately. Fiat has a similar case in 2018-2019. In 2018, Fiat sold more than 15,000 cars in the U.S., down from a high in 2014 of over 46,000. In September 2019, Fiat Chrysler Automobiles NV announced that it would stop the production of its Fiat 500 and electric 500e hatchbacks in North America. As part of the new strategic plan to counter the slow-down in the US market, the company has decided to continue with it’s 500CX crossover, 500L wagon and 124 Spider roadster series and focus more on segments such as Jeep SUVs and Ram Trucks. www.sganalytics.com www.sganalytics.com 66
US AUTOMOTIVE INDUSTRY Source: Automotive News Data Center Note: Fiat Chrysler revised U.S. sales reporting methodology in july 2016 and restated past results. Fiat reported that it’s sales were down brand is not part of the agreement. So is it 38% in the first half of 2019 in USA, with too late and too little? deliveries of the 500 dropping 25% to Yes, the 500 series which was one of the 1,692. Sales of the 500 fluctuated by more best- selling model in US, was lost due than half last year to just 5,370. to lack of adoption of technology, lack of Some of the key reasons for the poor interest to understand what the customer performance of Fiat in USA are plunging finally wants? Finally due to lack of AI and interest in passenger cars, a lack of body data analytics, the company registered style variety, a reputation for poor quality heavy loss. Now they plan to adopt AI and and a general lack of consumer awareness tech to revive the lost market. and the company’s lack of attention for The company wants to deviate from consumer insights and data analytics. traditional selling model and deviate. However, since the focus is on larger Once the cars are manufactured, they vehicles and trucks. FCA has finally could potentially be used by any third- focused towards upgrading it’s technology party company, (e.g. it can sell its finished and adopt smart tech. In June 2019, it products to Amazon for self-driving announced it’s tie up with Aurora, which is delivery vans) backed by Amazon and Sequoia Capital, to integrate its technology into Ram Truck vehicles, and later into the cargo vans segments. As of now FCA’s Fiat Professional www.sganalytics.com 7
US AUTOMOTIVE INDUSTRY 3) Ford Motor Company Among the early adopters of data analytics and AI, Ford Motor companies moved from being a conventional manufacturer to a “mobility service” company. Ford uses AI to track inventory, automate quality assurance as well; detect wrinkles in car seats. In addition, neural networks help support Ford’s supply chain through resource management. www.sganalytics.com www.sganalytics.com 88
US AUTOMOTIVE INDUSTRY Car Story the platform implemented by features, personalization and product Ford, uses AI technology to understand improvement consumers desire. Ford plans the inventory data for used cars. Ford to connect AI with all it’s mobile services in car’s dealer’s can learn details about the China by the end of 2019. condition of vehicles, owner history and At Ford, the GDI&A plays an important see how pricing is in the marketplace role in the preparation for machine using this tool. In 2019, Ford introduced learning usage. By working on data Edge Model which comes with artificial analytics projects, the GDI&A team of Ford intelligence as part of its all-wheel-drive delivers insights that are readily applicable system. By using dozens of high-tech to process improvements or product sensors, the system can determine faster development, and simultaneously lays than a human brain whether an all- the ground for future machine learning wheel drive is needed or not. It’s able to projects by having the data sorted. This shift between two- and four-wheel drive saves cost, helps them come closer to automatically. Machine learning techniques consumer needs and establish themselves added to vehicles help provide the new stronger among peers. www.sganalytics.com 9
US AUTOMOTIVE INDUSTRY 4) General Motors Company Market leader in every sense, the company has adopted AI and technology not only to streamline it’s business but also to improvise on it’s product design. Advances to 3-D printing technology have enhanced the company’s prototyping facilities, which are said to have constructed more than 250,000 experimental parts in the last decade alone. www.sganalytics.com www.sganalytics.com 1010
US AUTOMOTIVE INDUSTRY General Motors has built a predictive with the company’s IT strategy overhaul. analytics platform that generates insights Among its key attributes is self-service into several core business strategies, analytics, which allows employees to including anticipating market demand for query a Google-like search interface for autonomous vehicles. Maxis — shorthand information about specific business needs, for maximizing insights — represents a including pricing, incentives and marketing multi-million-dollar investment in data- optimization, sales lead management and crunching technologies that coincides forecasting, and problem detection. 5) Tesla Tesla reported third-quarter revenue of market remains to be seen. Still Tesla does $6.3 billion. Tesla, the electric car maker stand out among it’s peers when it comes specialist has given investors plenty to look to technology adoption and disruption in forward in 2020. The company announced the automotive market. that it was ahead of schedule on its long- awaited Model Y crossover, expected to launch by summer of 2020. At the same time, Tesla says it is planning to make a limited run of its Tesla Semi truck next year, and hopes to soon announce the location of its European Gigafactory, where it aims to begin making electric vehicles in 2021. Tesla though started as a environmental friendly tech company has moved on to promote and boost more of it’s own achievements. Earlier in Novemeber 2019, the company claimed to have received 250K order of cybertrucks as pre-book. There are lot of promises that continue to make headlines some of these are entry in India market in 2020, launch of robotaxi network and more. Whether the plans get smashed like cybertruck glass window or shines in the www.sganalytics.com 11
US AUTOMOTIVE INDUSTRY
Thought Leaders and Their Role in Bringing
About Transformation in 2019
Tesla
Elon Musk does not any introduction. Musk has been
instrumental in changing the perception of buyers and
investors towards it’s products. For example, while the market
is raving about 750 horsepower enabled Turbo S model,
limited people have taken a not of Porsche Taycan that is
expected to deliver 90 miles per gallon while driving in the
city. His magic drives the buyer even after the failure
of window test on cyber trucks in November 2019.
Inspite of the debacle, Musk tweets “250k,” indicating
the number of pre-orders Tesla has received for the
Cybertruck on November 29,2019.
That’s the magic of thought leaders who drive
technology and transformation in the market. Elon
Musk has promised robo taxis and so many other
technologically advanced products to the world that
it has created hype among the new generation. It remains to be seen if he can deliver on
his promises.
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Diamler, USA
Kristi Langdon - Ms.- Langdon Heads the Customer
Experience Division at Daimler Trucks North America and
leads the customer centric processes in the company. Few
of her recent achievements are leading the Voice of the
Customer’ program, design thinking tools and training,
customer satisfaction measurement, and employee
experience programs.
(Outside USA - Walid Mehanna who heads the Data
& Analytics was able to demonstrate more sale of
products using AI and Data Analytics in Europe)
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General Motors
Les Copeland - Les drives Global Data Strategy,
Artificial Intelligence & Analytics Services. In close
partnership with GM’s new Corporate Data Council,
Chief Data Officer and Chief Strategy Officer, Les and
his team are designing and implementing strategies
to maximize GM’s use of its enterprise data, IoT,
autonomous and connected vehicle data and vast
amounts of other external data. Les’ goal is to help GM
make its big data and analytics platform one of its most
valuable and highly leveraged corporate assets. Earlier
in his GM career, Les was responsible for collaborating
with GM’s global president and regional presidents
in designing and executing GM’s global sales and
marketing innovation portfolio.
www.sganalytics.com 14US AUTOMOTIVE INDUSTRY The Road Ahead Electric vehicles sales were only 1.2% watch for another year. of vehicles sold in the U.S. in 2018, but Stay Tuned, as we will come back to you things have changed in 2019. Automakers with another perspective of the young from Ford to Tesla are building a new buyers in2020 and help you gather the generation of electric vehicles that is faster directions of US automotive industry, next and more powerful than almost anything year. else on the road. Since 2010 onwards, electric vehicles have been the prime focus of major markets and governments. However, the progress has been slower than expected but the good news is that it is still happening. There is lot of excitement over new launches planned for 2020. Audi, Ford Motor, Porsche, and Volkswagen are among the brands expected to debut all-electric vehicles while others such as Lincoln and Karma Automotive also are expected to tout the performance of new plug-in hybrid electric vehicles, giving competition to the tech- auto leaders in US. Hope and optimism is growing inspite of a slow 2019, buyers and market will decide whether they will switch to electric vehicles more in 2020? Or they will just wait and www.sganalytics.com 15
US AUTOMOTIVE INDUSTRY
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