How the Automotive Industry can monetize digital transformation investments
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How the Automotive Industry can monetize digital transformation investments

How the Automotive Industry can monetize digital transformation investments

The speed of the automotive business demands is increasing necessitating real-time smart controls

  • Automotive industry investments of $19.57 billion in 2015 expected to increase to $82 billion by 2020
  • A new generation of “connected” and autonomous cars will produce 50 megabytes of data each second
  • The benefits of digitization in the Automotive industry start at the connected products and operational technology layer

By Schneider Electric: Leading the Digital Transformation of Energy Management and Automation in Homes, Buildings, Data Centers, Infrastructure and Industries

According to the analyst firm Research and Markets, automotive industry investments of $19.57 billion in 2015 are expected to increase to $82 billion by 2020 as a result of growing digitalization and technology advancements. Innovations in electrification, supply chain digitalization, connected vehicles, autonomous driving, and shared driving are all offshoots of this greater digital transformation trend. The speed of the automotive business demands is increasing — real-time smart controls are needed to improve areas such as safety, efficiency, reliability, flexibility and availability, to reduce environmental risk all the way through to improving profitability. Although these changes open the door to new business opportunities, some significant challenges need to be overcome in order to capture those opportunities.

Read more: Can we really rely on the software that runs our cars and planes? Who protects us when it fails?

Within the automotive industry, digitization trends are all-encompassing. They will impact each stage of the automobile design/build/operate and support process, spawning many terabytes of data. For example, a new generation of “connected” and autonomous cars will produce 50 megabytes of data each second. That’s, on average, 20 gigabytes of data per day when on the road. In order to exploit and monetize all of that data, IT systems across automotive enterprises that gather, process, analyze and store that data, will need to be re-architected and reconfigured.

Companies like Schneider Electric are well-positioned to accommodate these IT system changes. Whether it be energy management, innovative data center designs (from micro data centers in dealerships and offices, to centralized enterprise data centers, to rapid prefab data centers in plants and warehouses), Schneider Electric has the solution portfolio–from consulting, installation, operation and maintenance–and the expertise to help fuel auto industry mobility expansion.

New business models demand to reinvent IT systems

Traditionally, most carmakers are engineering-focused organizations. In this new world of mobility, a cultural shift to a more marketing and services-driven business model is required. In many cases, the financial subsidiaries of these automakers are taking the lead in the development of these services. Companies like Daimler and BMW, for instance, are undertaking joint efforts to develop new mobility services.

In order to facilitate these business model changes and the new influx of data, the various pockets of IT assets across centralized data centres, warehouses, manufacturing sites, R&D facilities, regional sales divisions and local dealerships will need to be reconfigured and expanded.

Read Expert: A bump in the road for driverless cars?

IT infrastructure will enable the best user experience and data monetization

To ensure the data generated are leveraged, automakers are motivated to make such IT infrastructure investments, for several reasons:

·         Additional revenues – By analyzing in real-time and cost-effectively the huge amount of data continuously generated by the connected cars on the road, they will be able to generate customized and differentiated mobility services, quickly adding to profits and revenues.

·         Traceability – By enabling better traceability of parts and tracking of vehicle performance in the field, potential auto recall impacts will be lowered. This will result in faster repair cycles, enhanced brand image and increased customer experience.

·         Value-chain digitization – In order to evolve to smart manufacturing, automotive companies will implement new digital solutions in supply chains, production and processes, thereby enhancing productivity, safety, and quality. This will empower the workforce and enable management teams to perform lean manufacturing. The data generated on a daily basis will be continuously monitored, leveraged and benchmarked.

·         Sustainability and energy consumption – Traditional data centres consume lots of energy. In the new “big data” environment, it will become more important to control data centre-generated energy costs. New scalable power and cooling technologies allow for both much higher energy efficiency and higher density computing in each rack. In addition, new-generation data centre infrastructure management (DCIM) software systems help to bolster data centre performance by enhancing systems uptime. This improves systems availability and lowers maintenance costs as problems can be identified before an unscheduled downtime occurs.

Read more: Tesla sets its eyes on self-driving cars - Tesla robotaxis by next year?

Big picture: A holistic approach adds value across the product life cycle

IT infrastructure solutions can add value at each stage of the automobile life cycle. A critical success factor is to assure that IT systems can maintain maximum uptime so that both employees and assets are productive. In addition, in an era of electric and even more autonomous vehicles, IT system availability will be critical to the driver experience.  Therefore, smart IT infrastructure consisting of standardized, scalable, end-to-end solutions will both cut costs and improve the overall quality of service and support that automakers can provide their dealers and customers.

The benefits of digitization in the Automotive industry start at the connected products and operational technology layer. Schneider Electric’s solutions allow businesses to gain more information from the many thousands of assets across the manufacturing facilities. Enabling improved control possibilities through data that can be transformed into actionable information, from which businesses can achieve greater control over Manufacturing, facilities and ultimately the whole business.

To learn more about how enterprise and edge data centre architectures can help to enable automobile industry modernization, visit Schneider Electric’sAutomotive and Mobility Solutions web site.

AMEinfo Staff

AMEinfo staff members report business news and views from across the Middle East and North Africa region, and analyse global events impacting the region today.

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