The autonomous vehicule: disrupting business models embedded in the smart city's revolution

Keywords:

Abstract:

26th Gerpisa International Colloquium
Who drives the change? New and traditional players in the global automotive sector

The autonomous vehicle: disrupting business models
embedded in the smart city’s revolution

Authors
Danielle Attias
Professor CentraleSupelec

Sylvie Mira Bonnardel
Professor Ecole Centrale de Lyon

The automobile must be today replaced into a new ecosystem of mobility characterized by major disruption in technologies, energy, socio-economic and ecological aspects as well as in business model propositions. The new mobility relies also on important relations between industrial strategies and public policies, mainly centered on smart cities development. Besides, a new type of customers is appearing, called “next generation consumers” or “next-gen consumers” (Firnkorn, Muller, 2015). This new generation of consumers demands a more durable, efficient and cheaper mobility and is ready to play within the rules of the circular economy.
Of one think we can be certain: the revolution in the car industry is fully embedded in the revolution of urban areas mainly through the arrival of the autonomous car building a new paradigm of urban mobility. This would be the major point of this communication.
Interaction between the autonomous connected car and the smart city are twofold: on the one hand, the automotive industry will influence shaping mobility patterns and on the other hand, public policies will organize the urban space within the new mobility paradigm, offering a multi modal mobility (Kellerman, 2011). On the economic perspective, this multimodal mobility will offer a wide range of new business models.
The smart city is sustainable, intelligent, digital, connected and innovative (Firnkorn, Muller, 2015), highly supported by IT systems. These IT systems aim at organizing intelligent transportation systems to lower congestion, to higher safety and control. IT systems also target communication between infrastructures and vehicles (all type of vehicles cars, bus, bicycles, and trucks) using Internet of Things technologies (Wasielewska-Marszałkowska, 2016). Clearly smart cities will implement smart mobility patterns (Ishida, Isbister, 2000), or Intelligent Transportation Systems (Nelson, 2009). Besides by enlarging the implementation of smart grids, smart cities will also regulate energy flows and help promoting a low carbon electro-mobility.
The car will be only one part of the mobility system that is to be multimodal (Attias, Mira Bonnardel, 2017). Moreover, the car will be marketed through a variety of alternative business models: possession by purchasing versus usage through carpooling, usage’s costs versus revenue’s generation through C2C car sharing.
The new mobility will mix different channels, B2B and B2C, but also C2C. Many web platforms offering car-sharing, charging and parking have been developing very fast these last ten years (Strasser et al., 2015).
In that new world of mobility, access to the Internet and digital solutions will be a part of every car. Route optimization, traffic analysis, car sharing, car renting, car connection and other services linked to car mobility will be used as a standard solution in every car (KPMG’s Global Automotive Executives Survey 2015).
All these possibilities will be linked with the variety of usages: short and urban travel versus long country side travel, professional versus personnel move, lonely versus collective mobility. No doubt that the autonomous car will transform the car industry. Two thirds of the sales amount planned for 2025 will indeed be related to software, on-line data processing and security systems. The car itself, produced by the manufacturers and OEM, will only represent one third of the value. Therefore car manufacturers must take very seriously the arrival of new comers like Google, Tesla or Apple on the market, as they are already very advanced in their programs (Donada, Attias, 2014).
New economic models connect the fourfold product-service-structure-market to the new technologies of mobility and to the societal shift towards sharing, or circular economy for which digital technologies permit the development and open the way to responsible, sustainable mobility in connection with the development of smart cities. (Attias, Mira Bonnardel, 2017).‬
In terms of methodology, as Head of the Armand Peugeot Research Chair, with the PSA Peugeot Citroën group, we identify and analyze the development of the new technologies and innovative business models of the vehicle of the future. This Research Chair is a member of the group's StelLab network, responsible for leading an interdisciplinary network that fosters discussion and dialogue among scientists and experts from PSA Peugeot Citroën. Over the last 6 years, together with StelLab, we have organized research seminars, workshops, and international conferences on the economy of electro mobility. This enabled us to hold several interviews with the executive managers of different companies as well as experts of the car industry and politicians.
Indeed with the development of the autonomous car, the automobile industry is likely about to give life to the “robomobile”, a new icon of a new era, the "multidimensional" era which helps individuals to escape the gravity of the couple space-time. This can be seen as the big-bang of the mobility’s world which creates passionate debates on the autonomous vehicle. The world race that started many companies, car manufacturers but also energetics specialists, IT companies, is also opening new opportunities for investors. The stake is considerable for cities willing to open their roads to autonomous vehicles. Their government has to totally rethink a model of urban space as a place of sociability. Moreover the robomobility can also leverage the city’s economic expansion thanks to flows’ optimization.
In that context, we think that we are to enter not only a new mobility paradigm for but a new way of living the urban space, with public policies and smart cities’ government do have a major role to play. This is what we will argue in this communication.

References
Attias D. The automobile world in a state of change, in Attias (ed), The Automobile Revolution, Springer, 2017, 7-19
Attias D., Mira Bonnardel S., (2017), Extending the Scope of Partnerships in the Automotive Industry: Between Competition and Cooperation, in Attias (ed), The Automobile Revolution, Springer, 2017, 69-85
Donada, C., Attias, D., 2015. Food for thought: which organisation and ecosystem governance to boost radical innovation in the electromobility 2.0 industry? International Journal of Automotive Technology and Management 15, 105-125.
Ishida, T. and Isbister, K. (2000), Digital Cities: Technologies, Experiences, and Future Perspectives, Springer Science & Business Media, Berlin.
Kellerman, A. (2011), Mobility or mobilities: Terrestrial, virtual and aerial categories or entities? Journal of Transport Geography, 19, 729–737.
Nelson, S.P. (2015), Challenges and Technologies: The Human Friendly Vehicle in 2030 and Beyond, Freescale Semiconductor, Inc. Available from http://www.freescale.com/files/ training_pdf.
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