1、Digital Auto Report 2023What consumers really wantVOLUME 1Strategy&2Eleventh annual Digital Auto Report,developed by Strategy&and PwCGlobal consumer survey with a focus on the US,EU and China(n=3,000)Quantitative market outlook up to 2035,based on regional structural analysisInterviews with industry

2、 executives at OEMs and suppliers,and with leading academics and industry analystsDigital Auto Report 2023Digital Auto Report 2023 Volume 1Coming up next:Volume 2Assessing global mobility market dynamicsMarket outlook penetration of technologies and mobility typesTechnology shifting gears in connect

3、ed,electric,automatedRegulation slowdown or acceleration of key policies?This report:Volume 1Understanding consumer preferences and implicationsConsumer view changing mobility preferencesImplications for auto players interface,subscription and chargingStrategy&Addressing changing consumer preference

4、s requires auto players to gear up their user interfaces and business modelsNote:Please refer to respective section for detailed assumptions and sources behind stated propositionsExecutive summary Volume 1Digital Auto Report 20233Our consumer survey(n=3,000 in Germany,US,China)captures current prefe

5、rences in auto&mobility and is contrasted with expert opinionsIn respect of connected services,consumers first want to get the basics right the highest priority is safety+navigation,phone mirroring is gaining importance,on-demand car functions as well;experts rate the importance of infotainment and

6、lifestyle higher than consumers do;willingness to pay for full set of connected services stands at 20/months in GER and the US,and at 40 in China experts give more conservative estimatesGermans still hesitant about BEV cars only 35%would consider getting one;more openness in the US 50%;China very op

7、en to BEVs with 90%Low trust towards L4 automated vehicles in GER and US with 60-70%feeling uncomfortable vs.15%in China;but on the other hand,Germans who want to use L4 have a higher willingness to pay to use robo-taxis than to use driver-driven taxis;in the US and China willingness to pay is lower

8、Purchasing a new/used car preferred;subscription models gain traction;online car purchase scores highest in China(36%vs.10%in Germany)Consumers intend to use public transport more often than last year,but show similar intentions for own car;less interest in sharing/hailing1.Consumer preferences2.Aut

9、omotive implicationsAuto players face strategic challenges with regard to connected,electric,automated&smart mobility.Volume 1 focuses on three key aspects:A Getting the user interface rightAs software-defined vehicles open the door to many new markets,OEMs need to be clear in which consumer life ar

10、eas they want to play,which experience differentiators to focus on(luxury vs.convenience),and how to build a corresponding service portfolio.Investment decisions should be based on value creation beyond direct user revenues,with a balanced view on build vs.buddy vs.buy for tech componentsB Rethinkin

11、g vehicle salesOEMs benefit from a rising demand for car subscriptions-expected to grow from 0.3m to 2-4m units by 2035 in Europe.To reach profitability.OEMs need to balance consumer needs(model flexibility,transparent pricing)with smart asset lifecycle management for maximum residual valueC Going b

12、eyond the vehicleNew business models emerge around batteries and bi-directional charging.With 5m bi-di cars in Germany by 2035,market potential is 160-220m for vehicle-to-home/microgrid and 470-550m for vehicle-to-grid solutions assuming successful orchestration of ecosystem playersStrategy&Contents

13、2.Implications for auto players interface,subscription and charging1.Consumer preferences connected,electric,automated and smartDigital Auto Report 20234Strategy&Latest consumer attitudes within CASE are reflected in a survey of 3,000 respondents in Germany,US and China*Age brackets harmonized;*Low

14、income(1,6T EUR,2T USD,8,3T EUR,10T USD,64T YUAN)Overview of consumer surveyDigital Auto Report 20235Consumer OverviewKey resultsn=1,000Gender(%)n=1,000n=1,0005149Age*(%)Household income*(%,gross monthly)9 743248Medium incomeLow incomeRather low incomeRather high incomeHigh income33353235-5418-3455+

15、3regions15questions3,000respondents50504456273736184339243018910213127138Employer type of experts(%)211663OEMSupplierOperator18384433531450expertsPurchasing a new or used car still preferred option,but car subscription models are gaining tractionConsumers want to reduce CO2 mainly through more walki

16、ng/cycling,switching to electric car,and using more public transport Safety+navigation remain the most important connected services features on-demand functions gaining popularityWillingness to pay at 20 per month in Germany and the US,while at 40 in China experts more cautiousGermans still sceptica

17、l about BEV cars only 35%would consider getting one,but more openness in the US 50%In China,overwhelming preference for BEV with 90%considering such option vs.only 80%considering ICEGerman/US respondents sceptical about L4 automated cars 60-70%uncomfortable vs.15%in ChinaWillingness to pay for robo-

18、taxis vs.driver-driven taxis is lower in the US and China than in GermanyStrategy&Safety and navigation remain as most important connected services features on-demand car functions on the riseSource:PwC Strategy&consumer researchSafety and navigation still mostimportant feature for respondents acros

19、s all regions.Significant increase in the number of participants in Germany who rate smartphone mirroring as important”Mirror smart-phone in car27%NavigationSafetyInfotainment/EntertainmentVehiclemanagementOn-demandcar functionsLifestyle and comfort80%78%69%60%45%39%82%78%71%61%55%62%59%93%92%96%76%

20、85%89%92%Question:“Which connected service categories are particularly important to you?”Consumer Connected202320212020Infotainment/entertainment more important for younger consumersDigital Auto Report 20236Connected services Share of participants rating feature as important+Infotainment/entertainme

21、nt more important for younger consumersStrategy&Experts rate infotainment higher than consumers do in China,they underestimate relevance of on-demand functionsSource:PwC Strategy&expert surveyConnected services Share of experts rating feature as importantSafety,navigation and entertainment are consi

22、dered the most important byexperts.Experts in Germany are rather less enthusiastic when assessing the importance of mirroring smart-phonesExperts in China are comparatively less upbeat when assessing the importance of on-demand functions and lifestyle&comfort services.”94898931736863Vehiclemanagemen

23、tNavigationSafetyLifestyle and comfortOn-demandcar functionsMirror smart-phone in carInfotainment/Entertainment-48%+63%+130%69946969758175+35%+28%80936780877367-27%+14%-25%Question:“Which connected service categories are particularly important to you?”Expert Connected2023 Experts 2023 ConsumerDigita

24、l Auto Report 20237Strategy&Smartphone mirroring to the car has highest rating;Auto OEM apps for service access are less popularSource:PwC Strategy&consumer research;Difference to 100%:no/low likelihoodConnected services and media/entertainment in the car53%69%45%32%On a screen mirroringfrom a smart

25、phoneinto the vehicleHighest preference across all countries is for smartphone mirroring.Media/entertainment via an auto OEM application is less popular.”Question:“How would you prefer to enjoy connected services and media/entertainment in your car?”Consumer Connected59%69%37%35%59%63%45%33%1stand 2

26、ndrankOn an appof content providerinstalled in your carOn my smartphonedirectlyAuto OEM appaccessing contentDigital Auto Report 20238Strategy&010203040506070Notes:1)Calculation of price points based on van-Westendorp-methodologySource:PwC Strategy&consumer research;Exchange rates:USD/EUR 0.93,YUAN/E

27、UR 0.14(15.02.2023);PwC Strategy&expert survey research 2023;n=50Connected services Median willingness to pay1)High spread of willingness to pay in China indicates strong polarisation of luxury vs.budget customers differentiated service packaging neededHigher optimal price in China indicates that co

28、nsumers envision more benefits from the“perfect connected service bundle”than in the US/GER expert view more conservative on prices.”Consumer Connectedfor a full set of connected services in the vehicle that“perfectly fit your needs”Willingness to pay1)(monthly in)Question:“At what price would you c

29、onsider a full set of relevant connected services Too cheap?”A good value for money?”Starting to get expensive?”Too expensive?”By nationalityXXXMaximum priceMinimum priceOptimal priceExpert estimateWillingness to pay for connected services around 20/month in Germany and the US but twice as much in C

30、hina(40)Digital Auto Report 20239Strategy&Among on-demand functions,automated driving features such as traffic jam pilot/parking pilot are attracting more interestSource:PwC Strategy&consumer researchOn-demand car functions Share of participants rating function as importantConsumer ConnectedAutomate

31、d driving functions traffic jam pilot or parking pilot attract considerably more interest vs.previous year.Air condition activation is still viewed as the most importanton-demand car function.”Question:“How important would be on-demand car function.to you?”69%63%63%53%48%49%44%Traffic jam pilotAdvan

32、ced headlightfunctions/performanceAir conditionactivationExtension of batteryrange(e.g.+80 km)Seat heatingactivationParking pilotIncrease of enginepower(e.g.+50 hp)60%52%53%77%65%62%41%87%95%78%85%87%86%90%20232021Digital Auto Report 202310+Traffic jam pilot more important for older consumersStrateg

33、y&Experts in Germany/US attach even more importance than consumers to automated driving function attractivenessSource:PwC Strategy&expert surveyOn-demand car functions Share of experts rating function as importantExpert ConnectedExtension of battery range and traffic jam pilot are considered the mos

34、t important functions among experts When compared with consumers,experts are particularly bullish about on-demand engine power.”Question:“How important would be on-demand car function.to you?”84%74%58%89%84%95%100%Increase of enginepower(e.g.+50 hp)Air conditionactivationExtension of batteryrange(e.

35、g.+80 km)Advanced headlightfunctions/performanceSeat heatingactivationTraffic jam pilotParking pilot+94%+129%94%63%69%81%81%94%81%+81%+108%87%73%73%80%87%73%87%2023 Experts2023 ConsumerDigital Auto Report 202311+Experts in US&China are more conservative in assessing the importance of air conditionin

36、g activationStrategy&H2O2+77%84%85%90%82%93%93%95%81%Source:PwC Strategy&consumer researchShare of participants rating engine types as likely for next purchase(%)Question:“Assuming you wanted to buy/lease/subscribe to a passenger car,how likely are you to consider the following types of engines?”Con

37、sumer Electric53%87%89%52%79%57%51%41%42%44%GasolineBEV69%80%PHEV73%44%39%35%35%35%18-34yo55+yo35-54yoAge bracketLooking at powertrain preferences,German and US consumers stick with gasoline,while Chinese prefer BEVDigital Auto Report 202312+Gasoline engine surprisingly more attractive for younger c

38、onsumersGasoline is most popular engine type in USA and Germany,followed by PHEV engines,which are slightly more popular than BEVs.Chinese consumers exhibit opposite preferences with BEVs being most popular,ahead of hybrid and ICE engines.”Strategy&Question:“How comfortable would you feel using an a

39、utonomous vehicle(Level 41)”1)There is still a steering wheel and pedals,but no human action or supervision is required,except in more complex cases such as inclement weather or an unusual environment2)Can operate fully automatically on any road and under any conditions that a human could negotiate.

40、There is no steering wheel or pedals.All you have to do is specify a destination to the vehicleSource:PwC Strategy&consumer researchAutomated driving Consumer attitudesConsumer AutomatedQuestion:“How comfortable would you feel using a fully autonomous vehicle(Level 52)”50%43%24%19%11%17%23%38%9%16%4

41、7%4%100%Very comfortableNot comfortable at allRather not comfortableRather comfortable66%53%18%18%13%10%17%30%6%12%51%100%6%Vs.14%in 2021Vs.18%in 2021Vs.39%in 2021In general,willingness to use automated cars has recovered in comparison with relatively low 2020 figures,which resulted from negative he

42、adlines at the time e.g.following accidents and cybersecurity threats.Scepticism towards“fully automated”vehicles(Level 5)still stronger than for Level 4.Consumer acceptance of automated driving remains low in Germany and the US more openness in ChinaDigital Auto Report 202313Level 5Level 4Strategy&

43、Source:PwC Strategy&consumer researchAutomated driving Top 3 preferences for usage of time gainedThe intention to use time gained from not driving went down compared to 2021 the reduction was significant in Germany and the US.Media&Entertainment as well as relaxation are still the main intended acti

44、vities.”Consumer Automated414533525139Relaxation and recovery(e.g.sleep)Media and entertainment(e.g.video streaming)Work and productivity(e.g.email)414030455539Work and productivity(e.g.email)Media and entertainment(e.g.video streaming)Relaxation and recovery(e.g.sleep)20222021575349626257Relaxation

45、 and recovery(e.g.sleep)Media and entertainment(e.g.video streaming)Social exchange(e.g.video-conferencing)Question:“For which activities would you use the time gained while driving in a fully autonomous vehicle?”On an robo-ride,people want to be entertained or relax in GER/US they also want to work

46、,but in China prefer to socializeDigital Auto Report 202314Strategy&60%of US citizens want to pay less for a robo-taxi vs.a driver-driven taxi;only 5%want to pay more vs.30%in GermanySource:PwC Strategy&consumer researchAutomated driving Willingness to payQuestion:“When considering an average taxi r

47、ide and its price,what would be your willingness to pay for an autonomous ride compared to this taxi ride?”Consumer Automated28%24%45%56%64%67%36%37%57%44%39%44%37%30%30%53%53%37%27%37%12%7%12%9%6%55+y35-54y18-34y35-54y18-34y55+y3%18-34y35-54y6%55+y100%Im willing to pay moreIm willing to pay the sam

48、eIm willing to pay lessDigital Auto Report 202315While younger German respondents are willing to pay more for an autonomous ride,older Germans are less inclined to do so.US and Chinese respondents overwhelmingly intend to pay less for an automated ride among those who want to pay less,a 40-50%price

49、cut from driver-driven taxis is the norm.”Strategy&Majority of respondents prefer to purchase a new or used car;but car subscription models are attracting interestSource:PwC Strategy&consumer research|Difference to 100%:no/low likelihoodRanking of buying/leasing/subscribing to a car70%87%47%33%27%Pu

50、rchase of a new carLeasingof a new carPurchase ofa used carSubscriptionof a carThe intention to purchase a used car is growing,especially in Germany and the US.Subscription is gaining in popularity especially in China.The preference for subscription increased strongly in Germany and the US in 2023(2

51、7%vs.14%in Germany and 19%vs.15%in US).”Question:“How would you rank the following ways of acquiring a car if you needed to purchase,lease,or subscribe to a passenger car in the next one to two years?”Consumer Smart Mobility76%78%31%19%19%82%29%56%7%43%1stand 2ndrankLeasing ofa used carDigital Auto

52、Report 202316Strategy&Readiness for online car purchases very high in China,while rather low in Germany the US falls in betweenSource:PwC Strategy&consumer researchWillingness to make car purchases onlineQuestion:“Would you buy your next car online?The willingness to buy a car onlinevaries significa

53、ntly across countries.In China,people are particularly open to completing certain steps or even the entire buying process online.In contrast,the majority in Germany feel more comfortable with store processes.”202341%10%37%12%I would rather do everything at the storeYes,I feel comfortable configuring

54、 and signing online,but I would prefer to do a test drive at the storeI would configure it online,but sign and test drive it at the storeYes,I feel comfortable with doing all steps online18%202332%27%22%202336%15%19%31%Consumer Smart MobilityHighHighHighLowLowLowWillingnessWillingnessWillingnessDigi

55、tal Auto Report 202317Strategy&20212023Even as immediate COVID-19 risks decline,using ones own car remains popular;increasing use of shared modes in ChinaSource:PwC Strategy&consumer research Mobility pattern after COVID-19 restrictions(%)Consumer Smart MobilityQuestion:“COVID-19 has temporarily cha

56、nged our mobility behavior in many aspects.How do you plan to use modes of transport once we have left the pandemic behind us?”MoreSameLess/not at allUsing ones own car is still seen as the most convenient means of transportation with highest increase in demand in Germany and the US.In China,consume

57、rs plan to use shared modes more.Across all regions,the number of people planning to use public transport more has increased.”202320212021202320212023202120232021202320212023Own bikeBy footOwn carPublic transportShared micro-mobilityCar-sharingRide-hailingDigital Auto Report 202318Strategy&45%60%60%

58、29%202136%202354%40%28%13%2023202125%Source:PwC Strategy&consumer researchFactors encouraging sustainable transportation modesIn Germany,there has been a sharp increase in the number of consumers who say that better availability is an important factor in persuading them to use sustainable transport.

59、US respondents focus strongly on cheaper prices,whereas user-friendly access is most likely to encourage respondents to use sustainable transport in China.”59%40%23%10%2021202324%Family offers(e.g.4 bikes for the price of 2,.)Cheaper priceBetter availability(e.g.more bikes)User-friendly access(e.g.c

60、ashless payment via app,.)Incentives by the employer(e.g.job bike,car sharing benefit package,.)Consumer Smart MobilityQuestion:“What would encourage you to use sustainable transportation(e.g.bike sharing,car sharing,public transportation)more frequently?”Price and availability are by far the top dr

61、ivers for encouraging consumers to use sustainable transportDigital Auto Report 202319Strategy&25%75%Source:PwC Strategy&consumer research Top-3 contributions to CO2reduction High willingness to contribute to CO2reduction,especially in China(98%)strong increase in the US(79%vs.52%last year)Main cont

62、ributions will be completing short-distance journeys more often on foot/by bicycle,switching to an electric car,or using public transport more frequently.”Question:“What major personal changes would you like to do to contribute to a reduction in CO2emissions?”51%29%25%Completely cut out short-haul f

63、lightsShort distances more often on foot/by bicycleUse public transport more frequently Short distances more often on foot/by bicycle43%24%37%Switch to an electric carUse public transport more frequently Use public transport more frequently 49%48%54%Switch to an electric carShort distances more ofte

64、n on foot/by bicycle21%79%DonothingChange behavior98%2%Consumer Smart MobilityEvery country has different priorities to reduce CO2:In GERmore walking,in the US switch to BEV,in CN public transportDigital Auto Report 202320Strategy&2.Implications for auto players interface,subscription and charging1.

65、Consumer preferences connected,electric,automated and smartDigital Auto Report 202321ContentsStrategy&Digital Auto Report 202322Getting the user interface rightStrategy&The relevant market for automotive players is expanding beyond the car itself maintaining user access is crucialSource:Strategy&,Pw

66、C EcosystemizerRealiserEnablerMobility demandMobility demand is influenced by long-term economic,political and social trends as well as generational changes The individual user is located at the center of the ecosystem approach(business to human)Consumer needs can be grouped into ten distinct Life A

67、reasWithin these Life Areas,ecosystems emerge in the form of business-to-business and business-to-consumer relationships around specific customer needsMobility solutionsHuman needs in mobility Life Areas determine customer requirementsSuccessful mobility ecosystem players are clear on four key topic

68、s:Digital portfolio scopeE.g.life area coverage,niche positioning,Experience differentiatorsE.g.luxury,convenience,Value chain integrationE.g.vertical/horizontal integration,partnering,Value leversE.g.top-line,bottom-line optimization,Digital Auto Report 202323Redefining business models to meet huma

69、n-centric mobility needs RecreationOrchestratorE.g.AggregatorE.g.OEME.g.SupplierStrategy&Getting the digital interface right means creating a differentiated experience for diverse customer needsSource:Strategy&analysis Experience differentiators ExamplesAt your fingertipsFINN manages to provide cust

70、omers with their vehicle of choice around seven days after booking7Hassle-free serviceGenesis picks up and returns the car for aftersales services at a place of choice,managed through a personal assistant Seamlessly integrated offeringsUber integrates multi-modal mobility options with related servic

71、es such as food delivery,health or transit on one platformFull flexibilitySixt offers various vehicle ownership models(renting,subscription,sharing)with flexible run times and payment schemes in one appProactive offeringsBMW 7 Series actively welcomes riders into the car by extending a carpet made o

72、f lightTrading scarcity Lamborghini has created only 5 digital NFTs based on physical keys made from carbon fiber from the international space stationDifferentiated experience:LuxuryDifferentiated experience:ConvenienceDigital Auto Report 202324Efficient interactionsMercedes me app lets users manage

73、 their vehicles on the go,from scheduling service,to making payments,to getting assistance at the push of a buttonBespoke services Bentley allows their buyers to customize every part of the car,including paint,finishes,materials and even light-projected logosDigital opulence Rolls Royce cements the

74、credentials of its bold new brand identity for its website with mood videos similar to perfume adsCrafted touchpoint NIO broadens their services with the EP House,a space where owners can come together and celebrate the brandStrategy&A value-creating digital service portfolio requires automotive pla

75、yers to balance multiple trade-offsSource:Strategy&analysisDigital portfolio scope ExamplesVehicle Function-as-a-ServiceConsumer onboard servicesConsumer offboardservicesB2B/data servicesPortfolio Trade-offsDifferentiation vs.revenue potentialReach vs.profitabilitySynergy focus vs.risk hedgingTouchp

76、oint controlvs.open partnersDigital first vs.BEV/AD availabilityMobilityEntertainmentWorkHealthSound BMW e-engine sound packAutonomous driving Tesla autopilot upgradeLight BMW high beam assistCamera Tesla sentry modeAccess Tesla virtual bluetooth keysParking search and pay VW we parkP2P car/ride sha

77、ring Sono motors appFleet mgmt./diagnostics Daimler connect businessCar data marketplace Caruso,Otonomo,High M.Car data based insurance BMW CarDataDrivers log/GPS tracking Daimler connect businessPredictive maintenance BOSCH,CarmenIntelligent car assistant Alibaba,Volvo/DaimlerGaming Tesla arcade,Ra

78、cingEntertainment Tesla caraokeAdvanced navigation MB live trafficMusic streaming BMW Spotify,NIO RadioPassenger safety NIO fatigue warningSmart Office Connection BMW IFTTT Last Mile Logistics NIO delivery in trunkEmergency assistant GM OnStar guardianPlug and charge VW/IonityMood-based lightening M

79、ercedes-Benz ambientIn-car Office Mercedes me connectMeditation Porsche Feel-Good-CoachNFT Collections Roll Royce PhantomAI Avatar Fetch.ai autonomous agentsCrypto Car Wallet Various pilotsIn-car AR gaming Audi/holoride partnershipRoadside assistant support Urgently/OtonomoAutomated park and charge

80、Bosch Autom.Valet ParkingSafer traffic planning Mercedes Data/LondonWeb3 Loyalty Program BMW/CoinwebDigital Auto Report 202325Strategy&30-40%additional revenue potential based on customer insights 30-40%of incidents can partly/fully be prevented by OTA 20-30%cost reduction potential through variant

81、reduction 20-30%inventory decrease due to demand forecasting50-60%of companies indicate that they do sell data to third parties 30-40%switch to paid subscription after free trial45-55%are more loyal to brandsto which they have a subscription35-50%are interested in post-purchase activations 60-70%are

82、 willing to pay 180$/year for connectivity service setAlong the value chain and vehicle life cycle,digital services unlock value beyond direct user monetizationValue levers of digital services ExamplesImplicationsBottom-line:OpEx/CapExOptimizationTop-line:Direct revenue and customerlifetime valueSer

83、vices monetizationBrand loyaltyPost-purchase activationsPlatform access/data salesConnected services activation fees and/or recurring revenues related to monthly subscriptionsHigher satisfaction with on-board experience and creation of stickiness through subscription servicesUpselling effect during

84、the ownership cycle by unlocking personalization features or activating built-in hardwareDirect revenues from granting third parties access to own platform or monetizing(anonymized)data/insightsLeverage of real time data on customer preferences/behaviorsfor timely adjustment of vehicle specification

85、s and features Reduction of the number of model-specific variants by activating on-demand vehicle features Optimized inventory management through advanced planning of upcoming repairs enabled by predictive maintenanceAfter-sales LoyaltyHigher revenues for dealers from original parts sale and worksho

86、ps traffic triggered by predictive maintenance R&D optimizationRecall campaignsVariant managementParts inventory managementPrevention of recall campaigns by leveraging OTA updates to fix potential technical issues within the circulating fleetSource:Strategy&analysis+expert discussion Digital Auto Re

87、port 202326Ecosystem business cases should extend beyond vehicle-centric business casesDirect and indirect revenue potential,and opportunities beyond vehicle offerings,should be considered along the customer life cycle B2B offerings offer significant direct monetization potentialIn addition to exter

88、nal opportunities,a significant amount of internal opportunities exist,e.g.to increase efficiency in processes&portfolioStrategy&IIIIIIIVVOEMs are forced to partner with technology players to deliver compelling digital services risking a loss of controlSource:Strategy&analysisValue chain integration

89、 Range of partnership optionsNo tech player involvementOperating system and all applications are developed by the OEMFull control for OEM,no standardization,slower development,reduced offering compared to market leadersOperating systemsupplyStandardized tech stack is provided by supplier,e.g.Android

90、 Automotive OSFaster development,easier integration of external applications(e.g.Spotify),standardized setting cannot be adjusted by OEMContent mirroringApple/Google content is displayed by using apps within the vehicle,e.g.Android AutoCommon mobile apps(e.g.Google Maps)are immediately available in-

91、vehicle;less use of OEM native apps/content Tech player involvementOEM ControlNext?A winning digital experience requires customer proximity,tech capabilities and effective data governanceDigital Auto Report 202327Tech player content using vehicle dataUsage of car data to enrich 3rdparty in-vehicle a

92、pps,e.g.for usage based insurance or location based commerceCompelling user experience on par with mobile app UX,but OEM apps loose advantage of specific driver/vehicle insightsExternal development of the digital experienceEntire automotive softwareis developed by tech supplierData governance betwee

93、n involved stakeholders crucial to avoid downgrading of OEM to pure hardware provisioningStrategy&Digital Auto Report 202328Rethinking vehicle salesStrategy&Duration(average figures for Germany)Included services Relative price per month Leasing2 years5-9years2)3 years1)Low,due to fewer services and

94、longer durationtrend1 month2-6yearsSubscription1 year1)High,due to high convenienceRental 1 day1 yearHigh,due to high amount of included mileage7 days1)Sharing10 min.1 week30 min1)Highest,due to highest convenience and most services includedtrendExact model selection/some configurationUp-front down

95、paymentInsurance,tax and registration Flexible cancellationDelivery and collectionSwitching models Residual value coverage Additional driver allowedRisk-dependent fee(driver history)Scheduled service,repairs/wear and tear Fully digitized customer journey /=Usually included /Depends on provider /Usua

96、lly not included Subscription fills the gap between leasing and rental offerings resulting overall in four major vehicle ownership archetypes1)Based Strategy&analysis;2)Depending on specific regulatory environment allowing“prolonged lease”Source:Strategy&analysisVehicle ownership archetypesDigital A

97、uto Report 202329Strategy&2.Lifecycle:Used car leasing(different customer(s)As alternative ownership models such as subscription emerge,OEMs need to sharpen their vehicle lifecycle mgmt.skillsSubscription customer and asset journey Example4.Used car leasingCustomer journeyVehicle journey012345789Car

98、 handoverScheduled maintenanceSubscription model suggested to customerFor their vacation,the customer temporarily adds a second driverCustomer occasionally uses car sharingCar enters used leasing contract with a new customerScheduled maintenanceRepairs followingaccidentScheduled maintenanceAfter the

99、 lease,the car is returnedYearRefurbish battery and ADAS in preparation for next lifecycleInteriorrefurbish1.New car leasing2.Subscription3.New subscription5.Car sharing and rentalMaintenance and minor fixesFamily plans:subscription renewal with bigger carDue to increased price consciousness,custome

100、r decides to lease a used carMove into city:end of lease and switch to sporadic sharing and rental carsCustomer signs contract to lease new carNew car is in-fleetedIn the last lifecycle,the car moves into the sharing fleetAt the end of its useful life,the car is recycled or sold B2BAfter the lease,t

101、he car is returnedCar rentalduring vacationResidual value optimal:customer offered to trade carsCustomer increases the annual km6Scheduled maintenance1.Lifecycle:New car leasing3.Lifecycle:Car sharing(different customers)Source:Strategy&analysisDigital Auto Report 202330Strategy&Suitable ownership m

102、odelsHolistic vehicle lifecycle management aims to increase revenue and utilization,especially during 2ndand 3rdphaseSubscription“3x3”asset lifecycle1stLifecycle phase(years 1-3)2ndLifecycle phase(years 4-6)3rdLifecycle phase(years 7-9)Residual valueRevenue and utilization potentialMaintenance and r

103、efurbishment1)In accordance with residual valueAdditional revenue from e.g.,contract extras or repair chargesAsset potentialRegular maintenance costs Sporadic refurbishment costsPotential repair costsDepending on vehicle utilization in respective ownership modelContract add-onRecycleLeasingSubscript

104、ionRentalCar sharing2)3)()Repurpose vehicleRefurbish vehicleMaintain/repair vehicleRecycle componentsAdd contract extrasSequence of ownership modelsas well as external market conditions have influence on most suitable selection for each lifecycle phaseFor certain ownership models,assets that are vie

105、wed as too old may not be favoredThe younger the asset,the shorter the duration-especially if utilization is high 1)Annual OEM-prescribed maintenance/service intervals and use-based repairs sporadic refurbishment;2)Depending on specific regulatory environment allowing“prolonged lease”;3)As low-budge

106、t optionSource:Strategy&analysis Digital Auto Report 202331Strategy&Alternative ownership models are on the rise and offer profit potential for OEMs if the asset life cycle is managed well1)Estimate of share development for ownership model depends on shares of competing models;LCP:Life cycle phase;2

107、)Profitability estimate based on individual consideration of ownership model for average middle class passenger EV(price 53.5k EUR)Source:Strategy&analysis Vehicle ownership model split and profitability IndicativeSharing42%100%10%Leasing2%SubscriptionPurchase45%Rental1%6.05.60.31.40.213.4Ownership

108、model split 2023 m unitsRegion Europe,40 countriesProfitability of ownership models2)Ownership modelsTraditional car ownershipAlternative ownershipPurchaseLeasingSubscriptionRentalSharingLCP 1 year 1-3LCP 2year 4-6LCP 3 year 7-97%9%11%-115%83%76%-91%78%71%10-15%5%5%5%Total5-7%10-15%10-15%10-15%5%Sub

109、scriptionhas potential to growto 2-4m unitsby 2035 in Europe1)Leasinghas potential to growto 7-8m units by 2035 in Europe1)Digital Auto Report 202332Overall profitability potential higher for leasing,subscription and rental than for purchaseProfitability across LCPs varies from relatively constant t

110、o a sharp increase.With rental,there is only one LCP.It is not individual consideration but a merged portfolio view that is crucial for OEMsStrategy&More flexible ownership models offer benefits and risks for OEMs and customers a win-win solution is requiredVehicle subscription benefit and risk pers

111、pectiveAlternative ownership models need to create a win-win situation for customers and OEMsCurrently,they mostly play into the strategic agenda of OEMsStrong customer centricityand efficient asset management of used cars are needed to reach profitabilityOEMs may leverage their existing retail netw

112、ork and preferential vehicle acquisition conditions to differentiate themselves from start-up competitorsProduct piloting and learning from data insights into longer-term car usageKeeping track of battery lifecycle/recycling requirements according to regulations Customers willingness to pay and pric

113、e pressure for alt.ownership offeringOEMCustomerFlexibility of car ownership in case of changing life circumstance Residual value and admin process(insurance,maintenance,etc.)peace of mindResidual value risk at end of lifetime and need for strong operational excellenceSource:Strategy&analysisDigital

114、 Auto Report 202333Key takeawaysOpaque pricing and difficulty of comparing offeringsPerception of ownership is absentStrategy&Digital Auto Report 202334Going beyond the vehicleStrategy&Rise of e-mobility provides ample opportunities to capture value beyond the vehicle e.g.with batteries and charging

115、Source:Strategy&analysisValue pools beyond the vehicle Focus e-mobilityDigital Auto Report 202335Battery value chainCharging value chainAdjacent ecosystem serviceseMSP1)Last mileservicesLocation-basedcommerceFleet mgmt.servicesOnboardentertainmentCharge point operationEnergy provisioningSite and ass

116、et ownershipCharging equipment manufacturingEnergy system integrationBi-directional ChargingBattery exchangeCar/battery usageBatteryproductionBattery incar assemblyBatteryrecyclingBatterysecond lifeInstallation and maintenanceStrategy&Infrastructure and vehicle penetration are key requirements for s

117、uccessful realization of bi-directional charging use cases Bi-directional charging Market simulation GermanyParkingHome and apartment buildingsCharging hubs1.8m0.16m0.03m0.7mBi-directional sockets by 2030Bi-directional charging-capable vehicle fleet(#)OfficePrivate2.5mPublic0.19mTotal 2030:2.7 milli

118、on bi-directional socketsTotal 2030:5 million bi-directional vehiclesBi-directional charging capable vehicle fleet in Germany(as share of total EV fleet)Source:PwC Strategy&Study(2022):“Der E-Mobility-Check:Wie bereit ist Deutschland?”;Strategy&analysisDigital Auto Report 202336202820232026202420252

119、031202720322029203020332034203536%11%6%15%29%22%54%42%48%58%61%62%63%Strategy&Enablers&LimitationsFront-of-meter prosumer use cases depend on a multitude of external factors that limit mainstream adoption in short term V2L:Vehicle-to-load(e.g.e-bike,another EV,etc.)V2H/B:Vehicle-to-home/building V2G

120、/VGI:Vehicle-to-grid/vehicle-grid-integrationPV:Photovoltaic 1)Includes software for grid optimization of households(V2H)and public charge point operators only;2)Includes software for power market trading for households and public charge point operators onlySource:Strategy&analysisProsumer charging

121、business model comparison GermanyPower market tradingLoad shiftingSelf-supply optimizationV2H/BV2G/VGIV2LMid-term:EV user demand driven by incentive to earn/save money,but depending on available solutions&attractive pricingShort-term:Growing EV user demand to use vehicle e.g.as additional storage fo

122、r home PV or emergency power bank(in the US)Customer DemandNeed for penetration of bi-directional capable vehicles and infrastructure(i.e.EV charger)to reach“critical mass”Need for development of standard protocols(interconnection,communication,vehicle and charging station safety&functionality)Energ

123、y TechFully supportive regulation not expected before 2028 at EU level due to high stakeholder complexity(smart meter as reference)Fully supportive behind-the-meter regulation expected by 2024 due to limited complexity of“closed”micro-ecosystemRegulationNeed for flexible V2G tariffs:Time-of-Use or T

124、ime-of-Day pricingMinimum number of kwh must be available at a certain point in time for utility providers to rely upon when managing the gridTech cost reduction(vehicle/infrastructure)required for scale upAvailability of comprehensive ancillary services as important enablerEconomicsUse CasesApplica

125、tion AreaEnabler RevenuesPotential for software enablers:160-220m1)in 2030While front of meter still requires more regulatory alignment at European level,behind the meter already has a high market readiness in the short term Potential for software enablers:470-550m2)in 2030Digital Auto Report 202337

126、Behind the meterFront of meter Consumption optimizationStrategy&Bi-directional energy provisionCharge and dischargeConnect to chargerRealization and scale-up of prosumer use cases require efficient charging and battery stakeholder coordinationSource:Strategy&analysisDigital Auto Report 202338Service

127、sWhite label SoftwareCharging dataCharging dataIntegrationChargingdataServicesEV dataCharging dataCharging dataEV/BatteryService providerSoftware supplierBattery manufacturerVehicle manufacturerParkingproviderUtilitysectorCPOEnd userV2HMain scale-up challengesStakeholder fear of losing control point

128、s to a central,dominant player(e.g.OEMs see USP in unique charging experience)Enabling ecosystem partnersCharging stakeholdersCharging&battery ecosystem stakeholder activationCan a decentralized coordination approach help to solve these challenges?Relatively high transactions costsfor clearing and b

129、illing(given comparatively low value of single transactions)Different interests and priorities across parties(e.g.CPOs want to maximize utilization,whereas OEMs want to maximize charging availability)Data exchangeStrategy&Implication for automotive players:Holistic ecosystem approach beyond core bus

130、iness is key to future successSource:Strategy&,PwC Ecosystemizer Be clear about own ecosystem role whether orchestrator,realizer or enabler Build offering portfolio and allocate resources accordingly Maintain a holistic and iterative approach in the selection of suitable offerings Actively manage th

131、e portfolio and prioritize clearly according to a coherent,consistent and multi-layered ecosystem logicOn the one hand Ecosystems can create lock-in effects based on differentiated offerings Customer lifetime value can be increased through holistic journey coverageFaster growth and higher earning po

132、tential can be achieved when compared with traditional approaches to value creationOn the other hand Building&managing ecosystems is complexTheoretically,unlimited number of potential offerings complicates the selection processProduct-centric view carries risk of missing market/customer needs(partic

133、ularly for more advanced topics)Success factorsEcosystemsDigital Auto Report 202339RecreationNew WorkPersonalized pleasureHolistic wellbeingSmart environ-mentRest and relaxationBelieve and mindfulnessRelation-shipsGreen and seamless mobilityCustomized and fast demand fulfillmentPersonal wealth and l

134、egalStrategy&Network contactsDigital Auto Report 202340Jrg K Automotive EuropeDr.Jrn N Alternative PowertrainsJonas SConnected and Smart MobilityContributors 2023 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.Ple

135、ase see for further details.Mentions of Strategy&refer to the global team of practical strategists that is integrated within the PwC network of firms.For more about Strategy&,see .No reproduction is permitted in whole or part without written permission of PwC.Disclaimer:This content is for general p

136、urposes only,and should not be used as a substitute for consultation with professional advisors.Dr.Andreas GDigital TransformationKentaro AAutomotive JapanAkshay SAutomotive USSteven JAutomotive ChinaSteven van ArsdaleSebastian Hauk Carl HeselschwerdtTobias KarlTobias KillmeierTobias Seemann Patrick SchwenkeMalien ZehnpfenningMilos B Infrastructure DealsThilo Bhnenthilo.buehnenpwc.chMobility VenturingHartmut GAutomated Driving