Author: Sherri Hammons, Chief Technology Officer, Beeline
The Internet of Things (IoT) is about to dramatically disrupt the automobile industry. We’ve seen the Google driverless cars roam California and watched Tesla auto-pilot free up the driver. Personally, I love to drive, and I hate to drive. On the one hand, I adore driving Sunday mornings with dance tunes blaring and the top down on my convertible enjoying a beautiful summer day. Alternatively, I abhor Monday morning traffic and my evening commute. I’m a bit torn on how I will love or not love driverless cars. Perhaps, I’ll be an early adopter. Perhaps, I’ll wait it out to see my options. But, driverless cars are coming. And they will leave a burning mark greater than Sherman’s March to the Sea. As a Board member of the IoT Consortium, not only am I passionate about this wave of technology, I want to share some predictions of how pervasive IoT and the driverless car disruption will be:
The automobile industry will divide into two: Regular and Premium Manufacturers
Regular manufacturers will create basic cars that cater to lovers of the sharing economy. Who needs to buy a car when you have shared cars available at your convenience? Consolidation of the industry will begin as cars become a commodity with little need to customize and compete for features. People will use them similarly to on-demand taxis/Uber where it matters less about the style and features and more about quick access. Those same automobile companies will become small retail shops and partner with smart startups to take advantage of all that free time you will have. You can choose a car that will bring you breakfast so you can eat on your way to work, or you can pick a car to get a manicure on your way to the airport. Cars will begin to morph into different service form factors to take advantage of your entrapment and time.
Premium manufacturers will also consolidate because demand will lessen. But these manufacturers will still offer cars for people to drive, though it will become more of a novelty than necessity. People will want the experience, not the expense, so new business models will arise and others will explode. Rent a Maserati for the weekend. Take a Ferrari to your class reunion. These manufacturers will offer the driverless option and will cater to the higher end clientele and special occasions. Call it the “First Class” of the Uber generation.
The Butterfly Effect
As the number of cars on the road will be reduced with this new car sharing economy, we will see a chain reaction with other industries as well.
There are many other examples of how this one change will affect an incredible number of industries. One change whose cause and effect will have lasting impacts on our economy. The Internet of Things is a revolution, changing the way our world operates. It’s exciting. It’s a bit daunting. And, if you aren’t thinking about it, it’s going to march right over you.