1. The automotive industry has continually evolved for more than 100 years. What's different about the changes it faces today?

The automotive industry is linked to its environment, and right now there are some macro trends that are driving big changes in approach. Those trends include globalization, digitalization and sustainable development. If a car company launches a new product or service today, customers all over the world may want it. A set of related developments, including the internet of things, big data and cloud computing, mean that digital technologies are having a huge impact on the industry, both in the way customers buy and use cars and the way they are built and run. Combined with the drive for improved efficiency and environmental sustainability, we are moving from the concept of "automotive" to the concept of "mobility."

2. How is the industry responding to those trends?

The products themselves are changing. We are seeing rapid growth in alternative powertrains, like electric propulsion, for example, and we are seeing closer links between automotive companies and the technology sector. That affects not just what goes into a vehicle, but also how it is designed and made, with shorter product lifecycles and an accelerating pace of innovation. Then there's a new focus on the customer experience. The industry no longer just sells cars, it sells a wide variety of services too.

3. What role does logistics have to play in the evolution of the industry's new business models?

Across the sector, digitalization is creating opportunities to optimize logistics. Low-cost sensors and cloud computing are improving visibility across globalized networks. Robotics and automation are boosting productivity in plants and in warehouses. The future automotive supply chain will be much leaner and more transparent, more automated and more cost efficient. The growth of mobility services will also require automotive companies to adapt their aftermarket supply chains to support vehicles throughout their lifecycles. Convenience and speed will be key customer requirements. That's going to create demand for new logistics solutions, like local distribution that can supply fast-moving parts on very short lead times, or proactive logistics solutions that use information from sensors in the vehicle to understand when a part needs to be replaced, then synchronize the delivery of that part to the arrival of the vehicle at a service center. At DHL, we are already running such "maintenance-on-demand" services for commercial vehicles and applying them to our own fleets.

Published: November 2017

Images: DHL