DIGITAL AUTO REPORT 2020 - NAVIGATING THROUGH A POST-PANDEMIC WORLD - PWC
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Digital Auto Report 2020 Navigating through a post-pandemic world
Volume 1
Anticipating post-pandemic
market dynamics
• Market outlook – penetration of technologies and mobility types
• Technology – shifting gears in connected, electric, automated
Digital Auto Report • Customers – changing mobility preferences: shared no more?
• Regulation – slowdown or acceleration of key policies?
2020 – Volume 1 Volume 2
Rethinking business models and
investments
✓ Ninth annual Digital Auto Report, • New business opportunities – hype or reality?
developed by Strategy& and PwC
• Economic value – market growth and unit economics
✓ Global consumer survey with a focus • Investment strategy – OEMs vs. VCs vs. Tech players
on the US, EU and Asia • OEM survival guide for a post-crisis market reality
(n = 3,000)
✓ Quantitative market outlook until 2035 Volume 3
based on regional structural analysis Building a software-enabled
✓ Interviews and survey with >60 industry automotive company
executives at OEMs and suppliers,
leading academics • Capabilities of a software-enabled company
and industry analysts • Deep dive on automated software development and testing
Strategy& | PwC • Capability build-up strategy – a platform approach
2
The mobility ecosystem is transforming into a fragmented future w/different adoption patterns and use cases by region Executive summary – Volume 1 • With adjusted technology expectations and changing post-pandemic customer preferences, CASE evolves. Consumers do not expect fully automated cars before early 2030s. Shared mobility growth is slowing down, relevance of seamless mobility remains high • Total vehicle parc expected to shrink in Europe (-0.5% p.a.) while growing in the US (+1.1% p.a.) and China (+3.9% p.a.) until 2035, driven by 1) mobility growth (highest in China), 2) customer preferences for sharing (lowest in US) and 3) vehicle disposal rate • Regulatory requirements are driving basic connectivity in EU and US (>85% penetration of new cars in 2020), while China is still at 44%. Total connected vehicle parc will pass 50% mark in Europe by 2025; in US as early as 2023 and in China latest by 2029 • EU and China are leading the e-mobility transformation with expected new car BEV share of 17% and 19% by 2025. US significantly lower with 5% by 2025 given fewer government incentives and attractive ICE alternative in terms of TCO • Automated driving will emerge in a broad spectrum of use cases with specific requirements that are difficult to scale. While e.g. L4 pilot projects with people movers are running today, L4 share of new vehicles is expected to reach 17% by 2035 in EU (vs. 16% in China) • Shifts in individual mobility patterns require a new segmentation in terms of private vs. shared and active vs. passive driving – each with multiple use cases at different automation levels. Shared-active (e.g. rental, subscription) expected to grow strongest in EU (10% of total person kilometers by 2025), while shared-passive (e.g. ride-hailing) is expected to grow significantly more in China (10% vs. 1-3% in US and EU) • The increasing proliferation of use cases and business models requires many players to re-evaluate their CASE strategies with a fact-based view on available technology, value pool sizes and unit economics as well as investment requirements and right to win (→ covered in our next report volume No 2) Strategy& | PwC Note: Please refer to respective section for detailed assumptions and sources behind stated propositions 3
With adjusted technology
expectations and changing
post-pandemic customer Connected Electric
preferences, CASE evolves”
S for Shared becomes
Smart (Mobility)*
Automated Smart Mobility
*Smart Mobility describes a transportation ecosystem where stakeholders use data and
connectivity to move people and goods sustainably and efficiently.
Shared mobility remains as a sub-segment and an important value pool in this ecosystem
focusing on people transport with passenger vehicles.
Strategy& | PwC Source: Strategy& 4Triggered by the effects of the COVID-19 pandemic,
many players will have to reevaluate their CASE strategies
Consumer Technology Connected Automated
COVID-19 postpones COVID-19 shatters old COVID-19 digitizes COVID-19 modifies
consumer spend during industries and will lead society and increases competition: Big Tech
lock-downs. Demand to market shakeout. acceptance and benefits, asset-heavy
recovery expected with Digital and remote demand for digital – and OEMs struggle to keep
preference for EV tech is on the rise connected – services up required R&D invest
Regulation Economics Smart mobility Electric
COVID-19 imposes COVID-19 cuts topline, COVID-19 reverses COVID-19 cools down
new norms for work accelerating saving needs preference for mobility economies, leads
environments, of OEMs and suppliers modes – own vehicles governments to subsidize
consumer interactions as liquidity becomes regain preference EVs and increases EV
and international trade critical to survive against shared market demand
Strategy& | PwC Source: Strategy& 5The acceleration of technology penetration will occur at
varying times and speeds globally, as local mobility transforms
Key considerations to anticipate tipping point of exponential technology adoption
Technology Consumer Regulation Economics Expected tipping points
• Connected service • “Digitally savvy” share of • Scope and timing of • Indirect value capture by
content and UX population enforced connectivity OEM
requirements
• Vehicle system/EE • “Freemium” segment • Effective end consumer
architecture services • Scope of data privacy pricing earlier 2030 later
Connected • Network infrastructure
restrictions
• Battery and powertrain • Premium/early adopter • Emission target levels • Superior total cost of
performance segment size ownership (TCO) of BEV
• BEV/PHEV incentives vs. ICE in relevant number
• EV manufacturability • “Rational green” segment
and production capacity size • Diesel/ICE of segments
bans/restrictions in cities • Additional
• Charging infrastructure earlier 2030 later
Electric revenues/savings from
V2G/V2X charging
• ADAS capability by use • Premium/early adopter • Scope and timing of • Superior TCO vs. non-AV
case segment size enforced ADAS safety in first commercial cases
features
• Data processing • Technology openness • Additional value capture
• Geographic range and from riders
• Driver UI quantity of AV test drive/ earlier 2030 later
Automated • Network and traffic vehicle approvals
infrastructure
• Smartphone penetration • Intermodal openness • Private car restrictions/ • Superior TCO vs. own
taxes vehicle
• Access and fleet • People/traffic density
availability “Frequent user” segment • Passenger transport • Dynamic pricing for opt.
size regulation use and availability earlier 2030 later
Smart
Mobility
ADAS = Advanced Driver Assistance Systems; EE = Electric/electronics, V2G = Vehicle to grid, TCO = Total cost of ownership
Note: A tipping point is defined as the start of exponential growth within a segment of the mobility transformation
Strategy& | PwC Source: Expert interviews, PwC AutoFacts®, Strategy& 6Total car parc growth strongest in China with high penetration
of connected and electric; automation relevant after 2025
Total vehicle parc and technology penetration (in million, %)
Assumptions
New LV sales 332 350
302 308 294 281 281 289 310 302
(million) 250 34 • Total vehicle parc driven by
197 31 − Growing economic mobility
14 17 17 17 13 16 17 18 demand after COVID-19
Total LV parc
22 28
(million) − Build-up of new mobility fleets
with high annual mileage
− Disposal of outdated vehicles
86% 100% 100% 100% 87% 100% 100% 100% 91% 100% 100%
Connected 44% • Basic connectivity with high
penetration due to regulation in
(eCall, % new LV sales) US/EU; share with over-the-air
(OTA) capability significantly lower
• BEV with strong growth in EU/
67% 55%
33% China due to government
Electric 17%
34%
14% 19% subsidies and earlier “total cost of
4% 2% 5% 8% 4%
(BEV, % new LV sales)
ownership” parity (vs. ICE) than in
the US
• Delay of automated vehicle
16% penetration at L4/L5 due to
Automated 7% 15% technical challenges and
0% 0% 0% 0% 1% 2% 0% 0% 3%
investment cuts; L3 with first
(L4/L5, % new LV sales) 2020 2025 2030 2035 2020 2025 2030 2035 2020 2025 2030 2035 useful applications before 2025
Strategy& | PwC Source: PwC AutoFacts®, Strategy& LV = Light Vehicles = Cars + Light Commercial Vehicles < 6t GVW BEV = Battery Electric Vehicle ICE = Internal Combustion Engine 7Connectivity will rapidly penetrate total car parc; OEMs need to
leverage platforms for scale, while maintaining distinct UX
Total vehicle parc and connected car share (in million, %)
350
332
302 308 310 302
294 281 281 289
26% 250
50% 32% 72%
197 35% 56%
78% 72% 16%
96% 97%
93%
2020 2025 2030 2035 2020 2025 2030 2035 2020 2025 2030 2035
Connected Vehicles Non-Connected Vehicles Source: PwC AutoFacts®, Strategy&
Total vehicle parc expected to shrink in Europe (-0.5% p.a.) while
growing in the US (+1.1% p.a.) and China (+3.9% p.a.) until 2035
– connectivity penetration >50% after 2025 in Europe and US.
Strategy& | PwC 8The shift from conventional to electric powertrains is under-
way; China and Europe head-to-head in market penetration
New vehicle sales by powertrain (in million, %)
17 17 18 34
17 17 1%
1% 4% 16 31 5%
17% 5% 8% 14%
14 7% 8% 28
13 10%
34%
4% 3% 9% 33%
2% 5% 19%
22 55%
67% 4% 1% 6%
10% 7%
88% 83% 75%
93% 74% 93% 9%
55% 95% 74%
60%
11%
32%
17%
2020 2025 2030 2035 2020 2025 2030 2035 2020 2025 2030 2035
FCEV BEV PHEV ICE (incl. HEV) Source: PwC AutoFacts®, Strategy&
Tightening CO2 emission targets in the EU and new
national guidelines in China accelerate BEV penetration
in these regions significantly faster than in the US.
Strategy& | PwC 9Automated driving will not arrive with a big bang: Various
useful functions and features will pave the way for L4
New vehicle sales by SAE level (in million, %)
17 18 34
17 17 17
1% 2% 1%
4% 7% 16 1% 31
14% 10% 13% 3% 15%
5% 28
14 13% 8%
13 1%
14% 18%
22
96%
94% 88% 84% 99% 89%
100% 78% 100%
68% 66%
100%
2020 2025 2030 2035 2020 2025 2030 2035 2020 2025 2030 2035
L0-2 L3 L4 L5 SAE = Society of Automotive Engineers Source: PwC AutoFacts®, Strategy&
Before deploying L4 passenger vehicles at scale, players will push the
next years for specific automated driving applications in transport /
fleets and logistics / industrial areas to recover investments.
Strategy& | PwC 10Transformation of mobility refocused towards shared active
and passive modes due to COVID-19 and slower automation
Market penetration by mobility mode (in ‘000 trillion person-kilometer, %)
4.7 5.1 5.3 5.4 5.3 6.1 6.4 6.7 8.5 10.4 12.2 13.8
6% 2% 2% 2% 2% 2%
2% 10% 16%
1% 1% 1% 1% 9% 2% 10% 2% 11%
2%
12%
3% 21%
5%
7%
92% 97% 97% 97% 97%
87% 89% 88% 87% 86%
79%
72%
2020 2025 2030 2035 2020 2025 2030 2035 2020 2025 2030 2035
Shared active Shared passive Private active / passive
[e.g. car sharing, rental] [e.g. ride hailing, (robo-) taxi] [e.g. own vehicle] Source: PwC AutoFacts®, Strategy&
Global market remains difficult to address with one mobility
service given high proliferation of different active & passive driving
use cases – new players invest in multi-mode transport platforms.
Strategy& | PwC 11This report series lays out in three volumes 1) CASE drivers,
2) economic opportunities, and 3) capability implications
Volume 1 Volume 2 Volume 3
Consumer Technology Regulation Economics Capabilities
Connected
Automated
Opportunity Build-up
sizing and and
Smart Mobility investments partnering
Electric
Strategy& | PwC 12Volume 1
Strategy& | PwC
Anticipating post-pandemic
market dynamics
13Digital Auto Report 2020 – Volume 1
Consumer Technology Regulation
Connected
Consumers are seeking
convenient and safe Electric
mobility – private
transport modes regain Automated
importance”
Smart Mobility
Strategy& | PwC Source: Strategy& 14Consumer – Overview
Survey among 3,000 consumers in Germany, the US and
China shows latest shifts in consumer mobility preferences
Key results
3 >20 >3,000 • Respondents confirm relevance of connected
regions questions Respondents1) services – security & navigation most important
• However, willingness to pay overall lower than
most OEMs hoped for
n = 1,0001) n = 1,000 n = 1,000
• Consumers expect AD vehicles in the early
2030’s; first in transportation, later in private cars
Gender 49 51 49 51 51 49
(%) • Two thirds of respondents would use
automated vehicles; of those 75% would pay a
premium for an automated driving of 5 – 20%
Age 17 15 15 19 34 22 17 16 18 27 21 21 27 17 14 per ride
(%)
• While new car purchase options lead across
18-29 30-39 40-49 50-59 60+
regions pre- and post-pandemic, interest in car
Gross subscription is growing strongly in China
monthly
household 26 40 29 10 15 70 29 47 23 • Regular cleaning / disinfection has become
income2) most important feature for shared mobility
(%)
offerings to ensure usage during COVID-19
4,000 USD
Strategy& | PwC 1) Questions on COVID19 effects of mobility behaviour in DE partially n=2,000 2) converted from EUR/CNY (Mid of August 2020) Remaining % up to 100% “not specified” 15Consumer – Connected
Respondents highlight the importance of connected services -
– safety and navigation rated as most important features
Connected services – By importance for consumers1)
Question: “Which connected
Safety 80% 90% 93% service categories are
particularly important to you?”
Navigation 75% 83% 92%
Vehicle
58% 71% 84%
management
Vehicle features
58% 68% 83%
as a service
Infotainment/ In Germany in particular,
47% 63% 79%
Enterntainment safety and navigation rank
Mirror smartphone as most important services.
42% 67% 74%
in car
Winning consumers in other
Lifestyle and
comfort
39% 59% 71% categories requires strong
USP and compelling story.
1) Share of respondents, who want to have connected services in their vehicles
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=3,000 (1,000 DE, 1,000 US, 1,000 CN) 16Consumer – Connected
Customers want in-vehicle connected services; however,
willingness to pay might be lower than OEMs hope
Connected services – Willingness to pay1)
Willingness to pay vs. reference prices of other digital & media services Question: “Would you like to have
Connected Car services integrated
Fully-fledged connected Spotify Mobile voice & Premium iPhone in your vehicle and are you willing to
service offering subscription2 data contract sports stream3) leasing4) pay a surcharge for this? If yes, how
much…”
$ 19.5
at 31% $ 11.9 $ 34.6 $ 14.2 $ 39.5
willingness
$ 17.6 China with highest share of
at 40% $ 10.0 $ 43.6 $ 19.9 $ 35.3 consumers (58%) who are
willingness willing to pay an extra for
connected services .
$ 4.3
at 58% n/a $ 9.8 $ 10.3 $ 33.4 Capturing this value requires
willingness providers to compete partially
against other digital services.
1) Local currency conversion to USD as of mid of August 2020 2) “Individual” plan 3) DAZN basic package for GER and USA, basic Tencent package in China 4) iPhone 11 64GB, 24 months leasing
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=3,000 (1,000 DE, 1,000 US, 1,000 CN); International Telecommunication Union 2019 17Consumer – Electric
Gasoline still most preferred type of powertrain in Germany and
the US; hybrid gains popularity and is most popular in China
Preferred type of powertrain by age (%)
Question: “Suppose you wanted to
buy a car: Leaving aside financial
aspects, legal requirements and
Gasoline Diesel Gasoline Diesel Gasoline Diesel Age segment
lack of infrastructure […] – which
60 years
47 67 Σ 67 39
PHEV BEV PHEV BEV PHEV BEV While 68% of Chinese
consumers below 40 years prefer
24 22 Σ 46 23 14 Σ 37 46 22 Σ 68 electric powertrains over
gasoline, only 46% in Germany
PHEV
32 16 Σ 48 24 8 Σ 32 39 18 Σ 57 and 37% in the US share this
& BEV
preference.
33 12 Σ 45 25 7 Σ 32 45 17 Σ 62
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=2,000 DE, n=1,000 US, n=1,000 CN Percentages may not total 100% due to rounding 18Consumer – Automated
Two thirds of respondents would use automated vehicles; of those,
75% would pay a premium for an automated driving service
Automated driving – Consumer attitude, impact factors and willingness to pay
Attitude towards AV (%)
47% 44%
37% 41%
26% 29% 26%
23% 23%
Top 3 Persuasive
would
36
factors for using AV
use AV 38 (% of respondents) Curious Accident Road Curious Accident Use time Relax Accident Use time
about and traffic about and for other while and for other
59 driving speeding safety driving speeding activities driving speeding activities
AV reduction AV reduction reduction
would use Willingness to Pay
AV only at “Would you be willing to pay a Premium Premium Premium
28 26
low speed/ premium for an AV (e.g. car
parking sharing, ride hailing)? If yes, 10 2 € 10 2 $ 20 1¥
how much more would you Base price Base price Base price
pay for a 5 km trip with a base
price of 10 €/10$/20¥?”
would 32
not use 36 36 Lack of Lack of Lack of
AV Desire Loss of trust in AD Desire Loss of trust in AD Desire Loss of trust in AD
Top 3 Deterrent to drive control technology to drive control technology to drive control technology
9 factors for using AV
7% 4% 3%
(% of respondents)
DE US CN 15% 14%
22% 19%
32% 34%
Source: PwC Strategy& consumer research 2020; n=3,000 (1,000 DE, 1,000 US, 1,000 CN)
Strategy& | PwC * Average willingness-to-pay a premium for a 5km ride with an automated vehicle instead of having a chauffeur or self-drive 19Consumer – Smart mobility
Mobility modes shift due to effects of COVID-19 – use of own
vehicle preferred over shared mobility and public transport
Mobility pattern after COVID-19 restrictions (%)1)
Question: “Assuming COVID-19
restrictions are lifted again, how
would you use the following mobility
Own
bike
33 32 35 35 25 40 35 27 37 modes compared to pre-COVID-19
times?”
By foot 32 38 30 44 26 30 43 31 26
Own car 31 45 24 67 24 9 60 24 15
Public
10 25 64 22 21 56 23 27 50
transport
Shared Own car is the clear winner in the
micro- 7 15 79 22 22 57 34 27 39 US and China. In Germany, the
mobility intended increase of car usage
Car-
5 18 77 22 22 56 25 24 51
is on par with bike and foot.
sharing
Taxi, At the same time, Germans move
4 20 76 25 22 53 30 27 43
Uber, … away strongly from shared modes.
More Same Less
1) On the example of transportation to/from work
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=1,259 DE, n=593 US, n=779 CN; Percentage may not total 100% due to rounding 20Consumer – Smart mobility
Shared mobility providers win consumers back with clear
disinfection concepts rather than with lower prices
Attitude towards shared mobility after COVID-19 lockdown (%)
Question: “Which requirements
should providers fulfill to ensure that
you would continue using shared
42 58 17 83 2 98 mobility offerings after COVID-19
lockdown?
1| Regular cleaning and
disinfection by the provider (28%) 1| Regular cleaning and
disinfection by the provider (50%) 1| Regular cleaning and
disinfection by the provider (49%)
2| Lower/cheaper
prices (25%) 2| Lower/cheaper
prices (40%) 2| Provision of disinfectants to/in
every vehicle (49%)
3| Reliable availability (24%) 3| Provision of disinfectants to/in
every vehicle (39%) 3| Lower/cheaper
prices (42%)
In Germany, quality / premium
… … … vehicles seen as least important
8| Offer of gloves and masks in
8| Reserved parking spots
8| Extensive geographical factor to return to shared modes –
the vehicle (15%) (26%) coverage (33%)
after cleaning, price and
availability are most important.
9| Higher quality/premium
vehicles (11%) 9| Extensive geographical
coverage (17%) 9| Reserved
(32%)
parking spots
No usage of shared mobility offerings at all Open towards usage of shared mobility offerings
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=2,000 DE, n=1,000 US, n=1,000 CN 21Consumer – Smart Mobility
Purchasing a new vehicle remains preferred option across
regions; China shows strongest increase in subscription intent
Likelihood to buy/lease/subscribe to a car before/after COVID-19 (%)1)
Question: “Taking the position of
pre-COVID-19, how likely was it that
your household would buy, lease or
subscribe to a new vehicle in
Purchase of 24% 46% 68% 2020/2021? How likely is it now?“
a new car 21% 44% 75%
Purchase/lease 18% 40% 48%
of a used car 19% 39% 52%
Lease of a 11% 29% 50% China, and partly the US, are
new car 10% 27% 54% open towards subscription
models.
Subscription 9% 24% 62%
In Germany, further market
of a new car 8% 25% 65%
education needed to win
subscription customers.
Likely / very likely before COVID-19 Likely / very likely after COVID-19
1) Before= 1 year ago, after = within next 1-2 years
Strategy& | PwC Source: PwC Strategy& consumer research 2020; n=2,000 DE, n=1,000 US, n=1,000 CN Difference to 100%: no/low likelihood to buy/lease/subscribe a car 22Digital Auto Report 2020 – Volume 1
Consumer Technology Regulation
Connected
Technology progresses
fast – yet complexity of Electric
autonomous driving has
been underestimated” Automated
Smart Mobility
Strategy& | PwC 23Technology – Connected
In connected services, OEMs are currently rethinking their
“build vs. buy strategy” on key technology components
Connected services components
Enabler Hardware Software Integration Content/Service Sales and CRM
Plan – Build – Ship – Update – Sunset
Key value Vehicle architecture and User interface and Vehicle-based services Offering bundling and
blocks Cloud infrastructure ECUs Automotive security
controls and apps pricing
I/O devices (e.g., sensors, Vehicle OS, over-the-air- 3rd party content and User ID and
Mobile/local network System integration
displays) update and cloud platform services personalization
3rd party hardware (e.g. Cloud/hybrid services incl.
Regulation Data Analytics Data interfaces and APIs Customer support
VR glasses) vehicles health services
Current • Cloud infrastructure costs • Centralized E/E • OTA update functionality • UI design (e.g. graphical • 3rd party content and app • Subscription vs. life-time
limitations • MNO costs architecture with zonal • Data processing and vs. voice only), store integration offer model
• Regional regulations ECUs (see chapter 3) intelligent data fusion • Online-first vs. offline-first • Transmission, collection, • Customer identification
• Sensor fusion and virtual • Security of data • Open vs. closed APIs and analysis of vehicle • VIN to UID
sensors connections health data (e.g. based • Data privacy
on sensor data)
Current • Leverage eSIMs for • Evaluate sweet spot • Define software-value-add • Focus on differentiating • Leverage smartphone • Bring user sign-up and
develop- customers and more between complexity strategy (see Chapter 3) adaptive user interface integration for non- log-in journey to perfection
frequent MNO tenders reduction and profitability • Use virtualization to • Provide and monetize connected markets • Connect to existing
ments • Enable expendable vehicle securely separate domains SDKs and interfaces for ecosystems (e.g. phone)
architectures 3rd parties
Crucial value blocks (own know-how necessary)
CRM: Customer relation management ECU: Electronic control unit HW: Hardware I/O: Input/Output MNO: Mobile network operator
Strategy& | PwC SW: Software VR: Virtual reality V2X: Vehicle-to-x communication Source: Strategy& 24Technology – Electric
Technology progress in e-mobility must be evaluated in the
context of tech trends across various alternative powertrains
Alternative powertrain developments
– +
ICE PHEV BEV H2 O2 FCEV
Internal combustion engine Electric drivetrain (electric motor, inverter, transmission) Fuel cell system
Efficiency improvement Cost reductions
Electrification Stack
Recuperation and boost as standard Silicon carbide power semi- Bar windings and increased notch Increased integration of
conductor switches (inverter) filling degree in electric motor Increase of power density
features with 12V (budget) or 48V inverter and motor
Optimization of catalyst
Increased electrification of auxiliaries
compositions (reduction of Pt)
(water/oil pumps, cam phaser, etc.) High voltage system and architecture and nano-scale microstructure
P2 topology avoiding drag torque Architecture Auxiliaries Optimization of bipolar plate
coatings
Reduction of friction losses Integration of power-units Top models up to 800 V, Increasing commoditization
(OBC, DCDC, DC charger) standard in volume 400 V of electrified auxiliaries
Coatings and microstructural
modifications on cylinder Balance of plants
Optimization of crankshaft bearings Stack internal humidification
Ball bearings for turbocharger HV battery system
System design Cell innovation and simplified water mgmt.
Structural integration of System design Increased cell capacity through larger cells
Combustion/emission optimization Tank
housing into vehicle body incl. recyclability Cathode cost reduction by minimization of cobalt
Increasing injection pressures content and cobalt-free cells Optimization of fiber winding
Variability in valve trains layout and process
Increased anode energy density via silicon
Particle filters for most powertrains Mixed materials to reduce
Intrinsic safe cells by application of solid state
including DI gasolines costs
electrolytes (polymers, inorganics, blends)
Variable compression ratio through Compressed H2 as standard
Dry (solvent-free) processing of electrode coatings for passenger vehicles
variable connection rod
Strategy& | PwC Source: Strategy& 25Technology – Electric
BEVs will become economic for several segments – but
extended ranges (600 km+) will not be viable with BEVs
Electric powertrain operating cost break-even timeline (vs. ICE)
Vehicle Viable Break-
segment Range powertrains Evolution of TCO leader even
– +
2020 2025 2030
Low 150 km H2 O2
2019
– +
A/B Mid 300 km H2 O2 2027
Budget
70 kW Long 600 km 2040 There is no fixed point in
– +
time when battery
Mid 300 km H2 O2
– +
2024
electric vehicles offer an
– +
C/D Long 600 km H2 O2
H2 O2 2035
operating cost advantage
Volume – +
100 kW Extra-long 800 km H2 O2 2038 over internal
– +
combustion engines – it
Mid 300 km H2 O2
2018
– +
depends on factors such
E/F Long 600 km 2024
as the vehicle segment
H2 O2
Premium – + – + – +
Extra-long 800 km 2028
250 kW H2 O2 H2 O2 H2 O2
and range"
Main assumptions: electricity and fuel prices as for Germany 2020; H2 price 5€/kg; PHEV driving modes 40% EV mode/60% ICE mode; FCEV driving modes 40% EV mode/60% FC mode
Strategy& | PwC One-time buying incentives not considered Source: Strategy& 26Technology – Automated
Hardware, software and infrastructure of automated driving
are improving, but overall progress slower than expected
Automated driving technology developments
Current status and limitations
Emergency
vehicle • Radar and camera sensors are
recognition developed with a good cost position
• Cheap LiDAR systems do not yet
have the necessary performance
Blind Surround • New ADAS computers based on low
spot view Hardware power tech are under development
Lane assist e.g. sensors
• Different driver assistant systems
Rear collision
warning mandatory beginning 2022 in EU
Emergency Collision
Park Driver Park Cross Topo- braking avoidance
Environment traffic graphy • Test and validation not yet mature
mapping assist monitoring assist Environment Pedestrian
alert detection • Motion prediction still not
Mapping detection
completely solved
Software
Traffic sign • Very large amounts of test data
recognition e.g. smart
complicate traditional analytics
data usage
Rear Surround
view view
• So far, there are only a few test
tracks that are fully developed for
automated driving
• Expansion of 4G by 2022 for
motorways in DE as basis for 5G
Infrastructure
e.g. 5G • For the time being only pseudo 5G
Ultrasound Short-/medium-range radar Camera
based on 4G (non stand-alone)
LIDAR Long-range radar Microphone
Strategy& | PwC Source: Strategy& 27Technology – Automated
While L3 enables various attractive use cases, user experience
and system complexity breakthrough is happening at L4
Automated driving SAE levels and AD function mapping
Environment Fallback for
Vehicle monitoring and dynamic System
SAE level Narrative definition control user interface driving task capability Exemplary AD functionalities
• Universal pilot (full autonomy)
HIGH …under all environmental and
Full All driving • Interactive pilot driving (control via touch/gesture UI)
5 automation
road conditions that can be
managed by a human driver
modes • Robo-taxi and automated people-mover (all
conditions)
System
The system performs System • Urban/rural/highway pilot with multi-lane change
…even if a human driver does Most
High all aspects of • Robo-taxi and automated people-mover
4 automation dynamic driving
(driving-mode
not respond appropriately to a
request to intervene
driving
modes
• Urban last-mile delivery
• Automated valet parking
Alternative or
specific)…
System conventional • Urban/rural/highway assistant (e.g. hands-off traffic
…expecting the human driver user interface
Conditional jam, intersection movement, single lane change)
3 automation
to respond appropriately to an
intervention request
• Parking chauffeur
• Assisted fleet operations (on-site, off-highway)
…executes both steering and
AUTOMATION • Adaptive cruise control
Partial acceleration/deceleration
2 automation
The human driver
(driving-mode specific)…
Some
driving
• Remote/key parking assistant
• Lane change assistant
modes
performs remaining Human Human
aspects of dynamic
driving, while the • Adaptive cruise control
…executes either steering or
Driver system… • Driver assisted parking assistant
1 assistance
acceleration/deceleration
(driving-mode specific)
Human and
System
Conventional •
•
Lane keeping assistant (system steers)
Blind spot monitoring rear/side (system steers)
user interface
The human driver performs all aspects of dynamic
No • Pre-/forward- collision braking
LOW 0 automation
driving, potentially “enhanced” by warning or intervention
systems Human
n/a
• Front/rear cross-traffic alert with braking
Strategy& | PwC Source: “SAE International Standard J3016”, SAE; Strategy& 28Technology – Automated
Commercially viable automated driving applications at L3 and
beyond will start becoming available for specific use cases first
Automated driving timeline of commercial road availability
Current developments
People mover (Sub-)Urban 30 Restricted
50 Restricted
• ADAS1) technologies require
Areas Areas
Pre-defined route(s)
7-12 seats higher development cost
Last mile logistics and efforts than anticipated
Pre-defined route(s) Urban 20 Restricted
40 Restricted
Areas
• ADAS sensors still far
Areas
e.g., parcel station
above target cost, due to
Robo-taxi (Sub-)Urban 60 Restricted
Areas
small production volumes
No defined routes 60 Restricted
Areas
and sensor fusion/
2-6 seats Rural
recognition challenges
Urban 50 50 Restricted
Areas
• Regulation still uncertain
with the UN/ECE technical
Owned vehicle Rural 100 100 framework and national
Restricted
Areas
No defined routes
2-5 seats
Highway 130 60 130 130
Restricted
Areas
rules not yet fully in place
• While first L3 vehicles
expected for 2021/22, first L4
2021 2023 2025 2027 2029 2031 2033 2035
road applications beyond
Commercial availability (beyond pilot projects)2)
pilot projects expected for
Level 2+ Level 4 xx Max. speed
Construction
Closed compounds Urban: Traffic situations with many traffic interactions and low speeds ~2025
area capable
Sub-Urban: Traffic situations with moderate traffic interactions and moderate speeds
Level 3 Level 5 Automated
Area restriction Vehicle follows user Rural: Traffic situations with few traffic interactions and higher speeds
lane changes
1) ADAS = Advanced Driver Assistance Systems
Strategy& | PwC 2) Indicating start of availability. Tipping points of significant adoption expected significantly later in certain fields Source: Strategy& 29Technology – Smart mobility
Individual mobility splits into four modes of private vs. shared
and active vs. passive driving, each with increasing automation
Private / shared mobility modes with selected automated driving use cases
PRIVATE 1) Personally-owned vehicle SHARED 2) Collective vehicle or ride
AUTONOMATION LEVEL
L5 Universal pilot L5
Automated
Robotaxi
Automated people mover
L4 Urban/rural/highway pilot L4
valet parking
PASSIVE3)
I am a passenger Urban/rural/highway Parking assistant Urban/rural/highway
L3 L3
assistant (for private driver) (for private driver) assistant (for public driver)
L0-2 Private/family driver L0-2 Taxi, ride hailing/pooling
AUTONOMATION LEVEL
L5 L5
Interactive pilot driving Interactive pilot driving
(vehicle control via touch/gesture UI “for fun”) (vehicle control via touch/gesture UI “for fun”)
L4 L4
ACTIVE4)
I am the driver Urban/rural/highway Urban/rural/highway Assisted fleet operations
L3 Parking/pick-up assistant L3
assistant assistant (on operator site)
L0-2 Self drive L0-2 Car sharing, rental, subscription
Differentiating AD use case
Traditional base use case
1) Includes self-owned, family-owned, credit-financed, long-term leased, personal company car 2) Includes rental, subscription (up to 1 year), ride-hailing, ride-sharing, car sharing, pool car, car club
3) “Passenger” determines mobility purpose and target, passenger selects means of transport and expected time of arrival, mobility system determines detailed routing and actual time/place of arrival
4) “Driver” determines mobility purpose and target, driver determines means of transport and plans arrival time, driver determines detailed routing and actual time and place of arrival through User Interface (UI)
Strategy& | PwC Source: PwC AutoFacts®, Strategy& 30Technology – Smart mobility
Seamless smart mobility services require a modular, open
API-based technology architecture and platform approach
Smart mobility technology platform building blocks
Partners & Data Sources Platform Capabilities
Current developments
User devices User interface Customer acquisition
and experience and retention
Mobility service
(rider, driver, partner) (direct, indirect) In contrast to individual mobility, providing
providers smart mobility requires a modular
Customer operations technology and system architecture,
Value-added
service providers capable of integrating various partners
API, Integration, Storage
Identity and access Rating and loyalty Exception handling
across the ecosystem with focus on
Advanced analytics
Retailers and
media • Flexibility to integrate multiple
Booking and ticketing Billing and payment
modalities and mobility service providers
Public transport (with different brands)
operators Product and quotation management (B2C or B2B or B2A)
• Cross-platform customer acquisition
Product configuration Real-time ride sourcing (Dynamic) consumer and seamless sign-up/-in
Events & weather
and calculation & negotiation pricing
conditions
• Region-specific/ local mobility product
Traffic mgmt. Fleet disposition (own or partner fleets) configuration and partner management,
systems Demand & supply Ride request & Fleet location incl. ride request/ offering brokerage
prediction matching and routing
• Real-time environment / asset
Infrastructure condition-based routing
Operations
• Predictive maintenance scheduling
… Vehicle condition Asset lifecycle Maintenance and
monitoring management repair management • Predictive asset lifecycle management
Strategy& | PwC Source: Strategy& 31Digital Auto Report 2020 – Volume 1
Consumer Technology Regulation
Connected
Regulation is aiming to
accelerate the mobility Electric
transformation – but
following very different Automated
approaches across regions”
Smart Mobility
Strategy& | PwC Source: Strategy& 32Regulation
Dynamic regulatory discussions shape CASE trends – impacting EV
penetration and speed of AV testing rollout in particular
Latest regulatory initiatives and discussions
USA GLOBAL
AUTOMATED:
AUTOMATED Announcement to unify AV policies CONNECTED Internationally harmonized and binding UN
Connected:
norms on cybersecurity and software requirements for OEMs
across 38 federal departments enforcing a consistent
(06/2020, UNECE’s World Forum for Harmonization of Vehicle
regulatory approach (01/2020) Regulation, WP.29)
AUTOMATED NHTSA with plan to introduce Automated:
AUTOMATED First binding global regulation on level 3
upgrades to NCAP, involving new safety technologies vehicle automation with focus on advancing safety (UNECE’s
and test procedures (10/2019) World Forum for Harmonization of Vehicle Regulations)2)
Automated:
AUTOMATED Updated standards for on-road testing of
ELECTRIC Limited national support (i.e. plans to level 3, 4 and 5 prototype ADS promoting a standardized
terminate EV subsidies) groundwork for AV tech (09/2019)3)
Heterogeneous regulatory dynamics; focus on Recently introduced regulations at UN level with positive
commercial dimension, less on sustainability impact on CASE adoption, further steps still required
EU China
Connected:
CONNECTED New guidelines on the ELECTRIC New EU CO2 emission Automated
AUTOMATED Release of the “Strategies Electric:
ELECTRIC New national guidelines on
processing of personal data (EDPB, 02/2020) targets, applying as of 01/20201) for Innovation and Development of Intelligent safety requirements and standards for EVs
AUTOMATED:
AUTOMATED Addition of new advanced Vehicles” with focus on creating an ecosystem (coming into force by January 1st 2021)
Shared:
SHARED New governmental regulations for AVs in China (02/2020)
test scenarios to rate AEB technology promoting shared mobility (e.g. free parking)
(2020 EU NCAP update) AUTOMATED
Autonomous: Plans for new changes
Autonomous:
AUTOMATED Updated guidelines to EU states with a siloed / bottom-up to the NCAP test program with new safety Top-down approach based on long-term
enforce advanced safety features (01/2020) approach towards CASE regulation additions (following the Euro model) strategy with positive impact on CASE
Positive expert sentiment Neutral expert sentiment Negative expert sentiment
Note: (1) the regulation targets a 15% reduction for passenger cars from 2025 on and 37.5% reduction from 2030 on. (2) e.g. establishes strict requirements for Automated Lane Keeping Systems. (3) incorporates "lessons-learned
based on accumulated field experience in testing prototype ADS-operated vehicles on public roads“. (4) general regulatory sentiment derived from various expert opinions across politics and industry, e.g. automotive associations.
AEB = Automated Emergency Braking; AV = Automated vehicle; NCAP = New Car Assessment Program; NHTSA = National Highway Traffic Safety Administration; UNECE = United Nations Economic Commission for Europe
Strategy& | PwC Source: Strategy& 33Network contacts
Jörg Krings Andreas Gissler Jonas Seyfferth Hartmut Güthner Jörn Neuhausen Claus Gruber
joerg.krings@ andreas.gissler@ jonas.seyfferth@ hartmut.guethner@ joern.neuhausen@ claus.gruber@
strategyand.de.pwc.com strategyand.de.pwc.com strategyand.de.pwc.com strategyand.de.pwc.com strategyand.de.pwc.com strategyand.de.pwc.com
Automotive Europe Digital Transformation Connected & Smart Mobility Automated Driving Alternative Powertrains Software Development
Contributors
Dietmar Ahlemann Martin Gerhardus Sarah Nolte
Felix Andre Jonas Heydasch Kevin Rothe
Christoph Stürmer Akshay Singh Steven Jiang Sebastian Böswald Andrew Higashi Tanjeff Schadt
christoph.stuermer@ akshay.singh@ steven.jiang@
pwc.com pwc.com strategyand.cn.pwc.com Thilo Bühnen Timo Kronen Nicola Schudnagies
AutoFacts® Automotive US Automotive China Christoph Faller Joram Lauterbach Felix Starke
© 2020 PwC. All rights reserved. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details. Mentions of Strategy& refer to the
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