Frost and Sullivan, a London-based growth business strategies firm, projects that more than 1,700 startups and technology companies are expected to disrupt and transform the automotive industry, including design, production, distribution, and retail. The component hardware-driven automotive industry is shifting its focus and investments on software and solutions with spending expected to reach $82.01 billion in 2020.
The company also projects IT spending will increase from $37.95 billion in 2015, to reach $168.8 billion in 2025, and investment will focus on electric vehicles, new mobility services, multi-modality, artificial intelligence, and autonomous vehicles. Security across both horizontal and vertical business layers will also be enhanced as businesses integrate, and country-specific, digital retailing strategy for new and used cars in addition to aftermarket and servicing will emerge.
“New business models will consider data, connectivity and customer centricity along with cybersecurity,” says Sriram Venkatraman, Frost & Sullivan Mobility senior consultant. “By 2020, chief digital officers will steer the strategic and digital initiatives of OEMs across luxury and economy brands.”
Digital Transformation of the Automotive Industry is the newest addition to Frost and Sullivan’s Future of Mobility Growth Partnership Service, which explores business activities, process improvements, and the development of competencies and business models across five key pillars: connected supply chain, industrial, connected and autonomous cars, digital retailing, and mobility as a service.
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