According to a new report from mobile operator Telefónica, consumer awareness of connected car products and services around the globe is growing.
In its annual study of buying behavior and attitudes, the telco found that 70% of drivers were either interested in using, or already were using, connected car services, while 80% of consumers expected that they would ultimately be have the access to the same connected experience in their vehicle as they would in their home via a mobile device.
“Through looking at the connected car from a driver’s perspective, it’s clear that the demand for connected services in cars is unquestionable. Even though we’re just moving off of the starting line, people are ready for it and know what they want. But challenges to widespread roll-out remain,” explained Pavan Mathew, Global Head of Connected Car at Telefónica.
In fact, around half of consumers now consider connected features, such as built-in connectivity and the ability to plug-in a smartphone, a key part of their next car purchase. Other features, including increased safety, early warning systems and smarter navigation, are cited as the most popular with nearly three-quarters (73%) of drivers listing safety and diagnostics components as the most important.
“I also think vehicle-to-vehicle communication is going to grow very quickly in the next five years. The beauty of that technology is that the communication protocol can be used for a host of other services beyond vehicle communication, so it benefits the wider infrastructure too,” said Kia Motors CTO Henry Bzeih.
Other key findings from the report include:
- Usage-based insurance models are also very popular, with 54% of UK drivers choosing it one of the connected car features they would be most interested in.
- On average 35% of drivers expect not to own their own car by 2034, and instead predict they will be using alternative options such as car sharing services.
- The dashboard is the favored way for accessing connected services, particularly for safety, navigation and vehicle diagnostics, with more than 60% of respondents across all markets preferring to access features in this way.
- Drivers in various countries will prefer to pay for connected services in different ways. Most Spanish drivers would prefer a one-off payment (49%) while those in America, Germany and the UK would favour basic connectivity with the option to choose additional services. Brazilians are split between the latter and a full-on PAYG model, suggesting a degree of flexibility not seen in other countries.
GM Director of Product Strategy and Infotainment Greg Ross explained, “For us it comes down to the things that make the car a better vehicle. When we talk to customers about connectivity they say well it’s a car and so what I need it to do are the things I bought a car for. They want it to be safer, more intelligent and more economical. Connectivity is a chance for OEMs to look at how we can help to reduce costs for customers and make cost of ownership lower by giving advice on how to drive more fuel efficiently, or helping you find the lowest cost source of fuel or the most efficient route.”
Additionally, another report from Infonetics Research has revealed that in the connected car market is expected to rise to nearly $8 billion in 2015 and reach $16.9 billion come 2018. This an increase from 2013, where the market valued at close to $6 billion. The firm states that some service providers are seeing as much as 90% of their M2M revenue generated from the connected car segment. According to the study, North America is the foundation of the global connected car business, accounting for 37% of global service revenue in 2013; Europe and Asia will be fast-growing regions. With sizeable auto markets and large land areas, countries like the U.S. and China are ideal for connected vehicle services.
As previously discussed in Bits & Pieces, automotive electronics are currently centered around people (infotainment and communications) and the machine itself (to run the car and provide safety and convenience). However, a third element is emerging; namely, vehicle-to-vehicle (V2V) communications.
You can read the entire “Connected Car Industry Report“ here.