10,000 liters of Neste MY Renewable Diesel produced from waste ham fat
BMW and Nissan again partner to add 174 more DC fast chargers in US with EVgo

KPMG Survey: execs say connected car generates 10x revenue than a conventional vehicle; market share based on units “outdated”; BEVs #1 trend

Advancements such as connectivity, big data, autonomous vehicles and artificial intelligence are driving new economic models for automakers, and most see tremendous revenue potential and consumer value in leveraging driver and vehicle data to offer mobility services, according to the 2017 KPMG Global Automotive Executive Study.

The KPMG research, which polled nearly 1,000 executives with the world’s leading automotive companies, found that 76% say one connected car generates more revenue streams than 10 conventional cars. In fact, expectations for data-driven revenue are so great that 71% say measuring OEM market share based on units sold is outdated.

The game has changed for automakers, as cars have evolved into rolling computers and consumers have been quick to embrace autonomy, connectivity and mobility-on-demand. A car is no longer defined by its utility, it is defined by the experience it provides to the driver and passenger—and that opens a tremendous pipeline for new revenue streams and business services that KPMG projects could top $1 trillion in the next decade or so.

—Gary Silberg, KPMG’s Automotive Sector Leader

Ford taps Apple for Chief Brand Officer
Ford has hired Musa Tariq as vice president and chief brand officer as part of its expansion to an auto and a mobility company. Tariq, elected a Ford Motor Company officer, begins work 30 January.
Prior to joining Ford, Tariq was Apple’s Global Marketing and Communication director for Retail. Prior to Apple, Tariq was the senior director of Social Media and Community at Nike, as well as the global head of Digital Marketing and later the first director of Social Media at Burberry.
At Ford, Tariq is responsible for further building and differentiating the company’s Ford brand. He will work with Marketing, Communications and company leaders to define, build and communicate the Ford primary brand and what it stands for with all stakeholders.

Eighty percent of executives in the KPMG study agree that data will be the fuel for future business models, and 83% believe they will make money off of that data. In order to create value and consequently monetize data, 82% of the executives agree that a car needs its very own ecosystem/operating system (OS) as otherwise the valuable consumer and/or vehicle data will be most likely routed through third parties. In this case many valuable revenue streams would be lost.

In conjunction with the executive survey, KPMG surveyed 2,400 consumers from 42 countries, to compare their perspective against the opinion of the world’s leading auto executives. KPMG found that consumers agree. Sixty percent of consumers say that as we move toward autonomous driving, they’ll only care about what they can do with the time they’re in the car, rather than the attributes of the car. However, both executives and consumers agree that data security and privacy is the top purchasing criteria in the self-driving age where passengers are interacting with the car’s digital platform.

You cannot overstate the importance of data security in the autonomous era. The massive amounts of data that is being collected presents a tremendous business opportunity for auto companies. Addressing information security concerns is a critical priority for automakers, and one they cannot afford to get wrong.

—Gary Silberg

Executives and consumers don’t agree on who should own that consumer and vehicle data. Auto execs are split between thinking OEMs (31%) and consumers (27%) should own the data, while consumers overwhelmingly believe only they should own it.

Good-bye to auto-digital fusion, hello to co-integration. KPMG analysts suggested that the emerging “clash of cultures” between the offline and online world in the auto industry is “insurmountable”—and that the two will never become fully congruent.

This means that we need to let go of the vision of a complete auto-digital fusion. We instead believe in an additional, overarching layer, a layer so to speak of the ‘next’ dimension in which both worlds are to some extent represented, a dimension characterized by co-integration in which the roles in the value chain have not yet been decided. For traditional auto companies, the key question will therefore be which role to strive for and how to tap new future revenue streams when traditional streams break away.

This year’s results demonstrate more than ever that the car itself will certainly be an essential part of revenue but not the only major source—of all the links in the value chain, it is the auto companies that will have to develop new service- and data-driven business models together in one digital ecosystem, placing the customer at the center.

—KPMG survey

50% of executives in the KPMG survey believe battery electric vehicles to be the #1 key trend, followed by connectivity and digitalization. BEVs jumped from rank 9 in 2015—when the consequences of e-mobility on OEMs business models were underestimated—to become the #1 key trend in 2017. Connectivity and digitalization have thereby even been overtaken. Strong regulatory restrictions have increased the pressure to react and therefore make e-mobility the top key trend among executives.

Interestingly, in China—the largest electric vehicle market—connectivity and digitalization still rank as the top trend. Click to enlarge.

Other findings from the survey include:

  1. 76 % of the executives see ICEs as still more important than electric drivetrains for a very long time. However, 53% of the executives wither absolutely (19%) or partly (34%) agree that diesel is dead—or at least socially unacceptable—for light-duty powertrains.

  2. 62% either absolutely agree (22%) or partly agree (40%) that battery-electric vehicles will fail due to infrastructure challenges. 78% either absolutely (33%) or partly (45%) agree that fuel cell electric vehicles will be the real breakthrough for electric mobility.

  3. High investments are planned for all powertrain technologies. Over the next 5 years, 53% of executives are planning to invest highly in plug-in hybrids and 52% in ICEs and full hybrids. However, looking at all powertrain solutions, there is only a 5% difference in distribution for high investment.

  4. Automotive executives are torn between new but immature trends and traditional technological solutions.

  5. BMW is still seen as electric mobility leader, but Tesla has made a big leap forward, moving up to second place, outpacing last year’s #3 Toyota and challenging BMW’s first place with only a 2% difference.

  6. 27% see BMW here as unrivaled leader in autonomous driving followed by Tesla with 9% and Honda with 9%. KPMG notes that the executive opinion does not correspond to the currently offered product range of the mentioned manufacturers.

  7. 68% of executives already feel that the traditional purchasing criteria will not determine the purchase of a car anymore.

  8. 89% absolutely or partly agree that in future, consumers will base their vehicle/mobility purchase on vehicle independent products and services.

  9. 83% of executives think it is extremely or somewhat likely that there will be a major business model disruption in the automotive industry.

  10. 59% of executives absolutely or partly agree that half of today’s car owners will no longer want to own a car in 2025.

  11. This year for the first time, executives see the production and sale of an automobile and the operation of a digital platform to manage direct customer relationships offering vehicle dependent and independent services over the whole customer lifecycle (Grid Master) as the favored business model for OEMs.




"62% either absolutely agree (22%) or partly agree (40%) that battery-electric vehicles will fail due to infrastructure challenges."

Wishful thinking? Primary infrastructure for BEVs is charger in the home. There will be a segment of drivers for whom BEVs are not a good fit, but that hardly rates a fail for the class.

Auto executives also seem to have a bias against Tesla in favor of traditional manufacturers, suggesting that BMW is the leader in EVs and autonomous driving. BMW introduced their only BEV, the i3, years ago, and has no new confirmed ones in their pipeline. Tesla not the leader in autonomous driving?


These are the same doofuses who, when polled, mostly thought Hydrogen fuel cells are going to be the big thing in 10 years, and BEV is a passing fad. Never mind that BEV is 250%-300% more efficient than Hydrogen from well to wheels, per http://phys.org/news/2006-12-hydrogen-economy-doesnt.html.


I read this study not as an indication of the trends, but insight into the mentality, and blind spots, of auto executives.

The view that hydrogen refueling infrastructure will prevail over electric charging infrastructure seems especially detached from all available facts, and ignorant of the successful players.

Until someone starts spending billions on hydrogen infrastructure, FCVs are a non-starter. VW, Tesla, eVgo and Chargepoint and dozens of utilities are already in the process of spending billions on public charge networks.

As ChrisL points out, home charging will be the vast majority of the needed EC refueling infrastructure. So the billions being spent on EV charging by providers mentioned above is only to complete the final 20% of the needed facilities.

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I also read it as evidence of how delusional most of the old auto industry is when it believes BMW is the leader in autonomous driving and that the BEV will fail because of the lack of charging opportunities.

As I see it there are only two important trends that will change the auto industry forever in the coming two decades and they are highly related. The first large change is the shift from human driven cars to fully self-driving cars. Tesla will make that happen on their entire car fleet by the end of 2018 and because we only need small electronic components and software this tech will be on all new cars made globally by 2025. Existing factories in the electronics industry can supply all the needed components. There will be zero global demand for cars that cannot drive themselves by 2025.

The second large change in the auto industry is the transition from internal combustion vehicles to BEVs. This change will take a longer time because it requires more investment in battery factories and factories for electric engines and power electronics. We need to invest about 500 billion USD in 100 50Gwh battery factories to make about 100 million BEVs per year. We also need to invest about 200 billion USD to make the factories for making enough electric motors for 100 million BEVs and another 200 billion for increasing capacity for raw materials for battery production.

Today BEVs are still not competitive for the mass market because they do not have the lowest life cycle cost per mile when you only drive a BEV the usual 15,000 miles per year. BEVs cost more upfront but they cost less to drive per mile afterwards. So the trick to make BEVs affordable is to drive them a lot and you can only do that in a low cost way with a fully self-driving car. Mass market BEV adaption will therefore not happen until we get fully self driving cars. Fortunately, Tesla will give us that by the end of 2018 and thereafter most of the old auto industry we see the light and start getting serious about BEVs.


A connected car, being used as a taxi could generate as much money as 10 user driven cars (perhaps), but you will only sell 1/10 as many of them.
+ people may hit "peak ad" and the value of online ads will reduce.
Also, I don't really buy the 10:1 ratio.
Most people want to go to work at the same time, so you will get max 2 rides / rush hour, not 10.
Plus, you have to reposition the car from "work_1" to "house_2", further more time.
Also, for dense cities, you really need mass transport, not individual cars (even if they are driven by a machine).

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@Mahonj I also thought about the rush hour argument that will prevent us from reaching 10 times in terms of miles driven per car per year. I saw a speech by a Tesla employee (previous head of autopilot program) where he said that outside of rush hours Tesla will increase usage time by making deliveries of packages. Expect to see online grocery shopping and automatic door to door delivery go really big. Also outside rush hours cars can drive out and self charge and go out and receive cleaning and maintenance service. 100,000 miles per car per year or 7 times the current usage rate should be possible even in the long run where the entire society works with self driving cars. People will also adjust their working and school hours in a society where rush our driving may cost 3 time the non-rush hour fare. Many work places and schools will offer different working hours to make themselves more attractive.

For dense cities extra transport capacity can also be made available by drilling underground tunnels restricted to small driverless BEV taxies (tandem two seats) that have no exhaust gasses and therefore do not need expensive ventilation and also can use a small 10 feet diameter hole for inexpensive drilling. Musk is working on providing such solutions for cities with a soon to be launched Boring Company.

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That Musk is serious about the Boring Company was just confirmed this morning



"7 times the current usage rate should be possible"

How's that? The kids are at school all day, parents are at work. Sure, you could haul packages around, but there's already a super-efficient fleet of private (UPS, FedEx) and public companies that do that.

The reason why there is a "rush hour" in the first place is that everybody needs to be somewhere at the same time. It's the same concept as "peak demand" for electricity. Unfortunately, transportation infrastructure has do meet peak demand, not average demand.

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Bernard rush hour exists partially because there is no price adaption due to private ownership of cars. Everybody has a car so they use it at the same time and there is no prices penalty for using it at rush hour. With most people using self-driving taxis there will be a peak price at rush hour giving people, companies and schools an economic incentive to plan differently so they avoid the peak hour prices. That UPS and others already is in the market does not mean they will not start using self-driving taxis that can be hired on-demand and at very low non-rush hour fares. Plus people will stop buying groceries themselves when they can get it delivered at night at the door for 1 or 2 USD. Wait and see.


On the way towards autonomy we can have computer assisted that saves lives everyday.


@Change, there won't be room for most people to use self driving taxis, they'll have to use buses or trains or some form of mass transport.
+ there has been an incentive for decades to spread the rush hour, but it hasn't happened.
Telecommuting and flexitime have helped a bit, buut you still have rush



Dr. Strange Love

Your car will become your apartment. The Shower and Commode will Pop-out of the trunk. The seats will fold down flat and inflate to provide the ultimate in sleeping comfort.


@Strange, I have had similar thoughts (with vans). People could increase their commute time from 2 to 3 hours, and sleep in their pajamas while driving, or work in the car. And snack and ...
I am not sure that that is a good thing, however.

Dr. Strange Love

There is nomad in all of us. I have had this crazy idea of a livable car for a long time. A van is better. You can support a family in an RV, but a van is more difficult and a car is impossible.

We all too large. Our housing accommodations are overly excessive to the extreme. For a migrant society, a livable car is an interesting solution.


I have seen news stories on people living in their vans/SUVs, some of necessity and some after making reasoned financial decisions. So, maybe downtown parking lots can double as modular hotels. Not great for families, but for some.

Dr. Strange Love

This is an Off-topic comment thread that is much more interesting than the topic.

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Musk tweeted a bit more yesterday about traffic jams, self-driving cars and tunnels.

“Without tunnels, we will all be in traffic hell forever,” Musk told The Verge via Twitter DM today. “I really do think tunnels are the key to solving urban gridlock. Being stuck in traffic is soul-destroying. Self-driving cars will actually make it worse by making vehicle travel more affordable.”
“Musk has been tweeting about tunnels for a month now and even said he’s going to build a tunnel boring machine and start digging. In developed cities, we can’t widen roadways, and elevated highways are ugly. So, we dig.”

The key point is self-driving cars make driving more affordable, like 50% more affordable, and it also makes it more convenient as you don’t have to drive but can do other stuff. So more cars are coming not less. And this is why we need to start digging in a big way.

I agree with DLS that with driverless cars we will see a demand for cars that can function as a home with shower, WC, work and sleeping area. These cars will be big, like a bus. They can be ordered on demand for overnight transport to destinations 300 to 500 miles away thereby replacing much short-distance aviation and the need for local hotel accommodation.


@mahonj driverless cars will lower the cost of driving alone in privacy so more people will do that. So less will use buses and trains. In other words, we need to dig to avoid a traffic Armageddon.

Dr. Strange Love

@Change. You and I need to schedule a meeting with Musk to discuss this. He has it backwards. Humans must start the Path to Living Under Ground. Cities, towns, neighbors to rural farm houses should all be leveled and built under ground. The Earth is a "Natural Insulator. This is a Geothermal remaking of Mankind. Space heating and Cooling will require minimal energy. The Sun will be all that mankind requires at this remaking of our living and working arrangements.

Transport will be above ground in our future.


Private electrified ADVs will increase traffic density in most cities and neighboring highways and will continue to create bigger and bigger traffic jams and delays.

One sure way to manage future higher traffic density would be with shared ADVs. Mini-bus ADVs with 6 to 10 passengers operating 'on-call' UBER style could work and reduce many private vehicles from highways and streets.

Tunnelled highways are extremely costly. Our 9.6Km almost bankrupted the city. Elevated highways are eyesores and do not last that long. Our costly 18+ Km has to be repaired too often. Sunken (open) highways may be a good compromise but can have major effets on other underground services.


One shared way is a Local Loop, an elevated maglev with single 8 person capsules that leave every minute.

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