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Creating EV ecosystems – How technology will improve mobility
November 2, 2022
Authored by RSM Canada LLP
Joel A. Humphrey, CPA, CA shared this article
ARTICLE | November 02, 2022
The electric vehicle (EV) era is arriving. Manufacturers are already transitioning their business models in anticipation of the full global adoption of EVs, hybrids, and new client service models. Not since the invention of on-board computers has the automotive industry taken such a transformational leap.
Yet, the mobility industry is facing several lingering challenges at the dawn of the electric vehicle age. What infrastructure issues will we face transitioning from a combustion-engine world? How will EV manufacturers be affected on the local and regional level? How will customer needs evolve in the next ten years? Technology may provide insights that can answer these questions and help create new EV ecosystems.
A whole new world
Before society can fully enjoy the benefits of EVs, there are several changes we need to make in what we deem the EV ecosystem. Like many other such networks, the EV ecosystem is greater than the sum of its parts; when adequately supported by charging infrastructure, technology partners, and customers, the benefits include cleaner air, improved mobility, accessibility, and convenience.
The first step in developing that adequate support, however, is to re-examine our entire transportation infrastructure. That includes projects to retrofit streetscapes that were designed with combustion engines in mind, and the significant hurdle of making EV charging stations widespread. How will roads change? What will happen to petrol stations? Will we see a 50/50 split, with traditional pumps sharing space with charging stations? These transitions will not be easy and will require significant investments up front.
There is also the challenge of adequate consumer demand. Asia and the European Union continue to show promising signs of full-scale consumer adoption, but the United States—arguably the largest auto market in the world—is still lagging. To further complicate matters, the current automotive industry relies on a patchwork of supply chains, many of which are isolated in just a handful of regions and are vulnerable to global and regional disruptions. Recent supply chain troubles continue to ripple throughout the manufacturing sector, threatening the viability of large-scale EV production.
Another EV challenge is consumers’ range anxiety around whether a vehicle will be able to complete a long trip or whether there is sufficient charging infrastructure across the whole journey. Governments and manufacturers alike have a role to play in making major investments in both rapid charging technologies and greater EV range before these vehicles are commonplace.
Another significant consumer concern with EVs is their interoperability with infrastructure. With many emerging technologies, various developers typically their own tech standards that often don’t “play nicely” with each other. Think of consumers’ frustration with smartphones and tablets using different charging cables depending on the brand. Now imagine their hesitation when considering a five-figure investment. Establishing a universal standard for charging will go a long way toward global consumer adoption.
As modern cars more and more resemble computers—packed with sensors, systems, and other technological augmentations—consumers will increasingly demand EVs that have interoperability across apps and platforms. As vehicles become smart devices, drivers will expect them to work with their smartphone seamlessly, whether to use their preferred navigation app or stream entertainment from their favourite platform. It is going to be interesting to see how newer vehicles rolling off the factory floor will be able to handle that demand. Greater levels of technology in the vehicles are taking us closer to a future with self-driving vehicles.
These technological advancements aren’t just changing our vehicles; they are spurring entirely new ways of thinking about transportation. Technologies such as augmented reality and haptic displays will continue to find their way into the auto industry, especially as more and more drivers take their hands off the wheel.
Some auto manufacturers have already introduced heads-up displays (HUDs) for GPS or touchless entertainment systems. As cars become more connected, more digital, and computerised, we will only see greater adoption and evolution of these futuristic technologies. Already, some companies are experimenting with the idea of putting GPS devices in motorcycle helmets. In the future, we may see haptics or HUDs in motorcycle helmet visors, sunglass lenses, or even cycling helmets. Coupled with predictive technology, we could see a world where wearable technology could help motorcycle drivers or cyclists avoid accidents.
Businesses that can develop automotive-focused solutions and then pivot them across other industries will likely be able to tap into myriad new opportunities in this tech-driven landscape
A new model
The technology itself is not the only thing revolutionising. Some companies are exploring the use of subscription-based models for leasing or buying EVs, and this has raised some eyebrows. However, consumers have become accustomed to a more on-demand, software-as-a-service digital model for many products. This is how we pay for our video entertainment; it is how we shop online, how we order our food, and it has made us accustomed to being able to order anything we want at the click of a button. One potential hurdle in using this model for vehicles is that modern consumers crave customisation, which might be challenging to deliver.
Ultimately, we expect demand will catch up to the massive expectations we have placed on EVs. Until then, the industry has its work cut out for it. However, if there is one thing auto manufacturers have always done well, it is repackaging an existing product in a much more streamlined, efficient, and technologically advanced manner to catch consumers’ attention. It may take five years, or ten, or even twenty, but the day will come when it is the fossil fuel vehicle that is the exception, not the rule.
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This article was written by Grand Lui, Tu Nguyen and originally appeared on 2022-11-02 RSM Canada, and is available online at https://rsmcanada.com/insights/industries/automotive/creating-ev-ecosystems-how-technology-will-improve-mobility.html.
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