Th Cb87A15037F7Ccf4E7Fe78500446B568 Paulasel

Emerging Services for Connected Cars

| USA

Paul Asel, Partner, NGP Capital

26.06.2014

A few weeks back, the Telematics Update Detroit drew more than 2000 people and 300 companies to discuss how auto tech could change our driving experience. Much attention is currently given to the Connected Car as most high end and many midrange cars are touting mobile connectivity.

Yet Connected Cars are a means to an end rather than an end objective. As car ownership descends to its lowest rate in decades among young drivers, enticing America’s youth is an ever greater priority. A survey by SBD, a European consultancy, shows that young drivers (aged 18-24) have higher expectations of their cars than the rest of us:  80% would like cars to better “understand my preferences, predict what I need and guide me.” They are already looking beyond Connected Cars to perceptive cars.

Once connectivity is in place, the perceptive car offers the potential to fulfill a dual promise of improved safety and enhanced services seamlessly integrated with their other connected devices.  In January at CES, Johann Jungwirth, head of Mercedes Benz US R&D, spoke of the Predictive User Experience: “Within the next ten years, consumers can look forward to a vehicle with contextual intelligence that will know their habits and adapt to their wishes.”

Many such advancements are already underway:

  • Camera and sensor technology:  Rearview cameras are appearing in cars to assist drivers in backing up, and the US National Highway Traffic Safety Administration is proposing rules to make them mandatory in light vehicles. But rearview cameras are just the beginning. MobileEye’s front facing sensors are used in 15 automakers to identify possible collisions and lane drifting and to initiate automatic braking. Sensors will increase tenfold in the car to warn of blindspots, navigate intelligently, and communicate with other vehicles. Further, fleets are using inward facing cameras to detect driver drowsiness and distraction. Since driver distraction is the leading cause of accidents, inward facing cameras and facial expression sensors will eventually be designed into consumer vehicles as well.
  • Navigation:  Studies show that the search for parking accounts for up to 25% of city driving. Navigation systems will soon be able to automatically identify available nearby parking and suggest parking alternatives based on user preferences. Ford has partnered with ParkMobile and Parkopedia for such an application with its Sync Applink service.
  • Usage Based Insurance:  Insurance companies such as Progressive and Allstate offer dongles to measure driving performance and offer lower insurance rates to reward good drivers. They have found that real-time driving alerts improve driver behavior by up to 25%.  As better data is integrated enhancing driving behavior and prompting more intelligent warning indicators, technology appropriately applied promises to substantially improve driver safety.
  • After Market Services:  General Motors pioneered aftermarket services through its OnStar offering. These services promise to be much more widely available through car dongles and eventually digital dashboards. Dongles help monitor car performance identifying potential problems early and proactively recommending car services to drivers. Automakers and repair companies are experimenting with aftermarket services and offers to reduce risk of accidents and failure. Sensors in tires are forthcoming to automatically warn of the need to replace worn tires.
  • Social:  The new BMW i3 has an electronic dashboard integrating with Life360 to keep track of, find, and communicate with family members and friends. Glympse offers a similar service. As various OEMs like Mercedes, Volvo, and even Ferrari have shown with their integration with Apple CarPlay, electronic dashboards will increasingly offer services that can be customized and intelligently rendered based on user preferences and habits.
  • Smart Home Sync:  Mercedes has announced that it will add Nest support to its vehicles, offering an app to automatically adjust home thermostats for heating and cooling as a driver approaches. For electric vehicles, automakers are partnering with home appliance companies to improve efficient charging. For example, Ford’s MyEnergi initiative offers an app that monitors utility rates in the home to enable vehicle charging to be optimized for best off-peak rates.

The Connected Car offers the promise of connectivity that could unleash a myriad of safety and driver enhancing services. Automakers and auto tech companies alike are looking beyond the Connected Car to a perceptive car that offers a more intelligent experience better integrated into our daily lives.

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