By Rebecca Sands, Content & Project Manager at Autonomy & the Urban Mobility Company

Click here to watch a recording of “OEMS Now or Never: How to Embrace New Mobility” held in partnership with Siemens Advanta Consulting.

In recent years, automotive OEMs have experienced a whirlwind of changes – many of them digital – to the sector as they knew it. Throw a global pandemic into the mix, and what you have were impacts to transportation that were perhaps more apparent than any other industry today. With new mobility actors gaining solid ground in the ecosystem prior to COVID-19, has the crisis provided a new opportunity for OEMs to reassert themselves into the market?

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It was this question that provided the backdrop for the Urban Mobility Company’s recent virtual workshop “OEMS Now or Never: How to Embrace New Mobility”, held in partnership with Siemens Advanta Consulting. Leading the discussion was Philipp Grosse Kleimann, Senior Partner and Global Head of Automotive and New Mobility at Siemens Advanta Consulting, who was joined by Jörg Reimann, CEO of Park Now and Charge NowDr Martin Koers, Managing Director of the German Association of the Automotive Industry (VDA), James Lancaster, Head of European Mobility Innovation at Enterprise Holdings, and Ivan Ollivier, Director of the Nissan Europe Innovation Lab. Here are the workshop’s key takeaways.

COVID-19: A Necessary Shakeout

The panel began as most have in 2020, addressing the effects that COVID-19 has had on the mobility industry at-large. For Jörg Reimann, and with the other panelists in unanimous agreement, the crisis was a necessary shakeout of business models, making crystal clear which ones were sustainable in the event of unexpected circumstances, and where the weak points lay. Crucial for any future growth is, for Ivan Ollivier, the ability of OEMs to forge partnerships and work with entire systems – cities, regulations, etc.  “My question is, will OEMs want to focus on their core business, and only embrace partners and adjacent mobility services when it is necessary to keep their business model intact?” asked Jörg. “This is where I see the industry trending, but I also don’t see OEMs stepping too far away from their core business.”

For James Lancaster, the crisis also presented a shakeout from the public policy perspective – stimulating new initiatives for mobility to contribute significantly to advancing green agendas, particularly in Europe. “Covid supercharged the move towards a more sustainable mobility,” said James. “Suddenly the priority was significant investments in safe, sustainable mobility and multimodality, and this policy acceleration will generate new business opportunities.” The question is whether or not OEMs will be able to harness ecosystem support to move towards more sustainable models, both for business and the environment – a factor which Ivan highlighted as vital for any path forward.

The Undeniable Trends of Electrification and Digitalisation

For Martin Koers, who sees the VDA as the voice of the entire industry, change is happening … and fast – particularly on the electrification and digitalization fronts. And while Koers believes the reasons for these two key changes are different, it is clear that they are very much tied to each other’s success.

While electrification has mostly been driven by regulation and efforts to meet emissions reductions targets, it cannot happen without being connected to the digital way that the industry is going. Without these two elements working in harmony to produce necessities like e-routing and charging, and without OEMs putting the right partnerships in place, the industry will not be doing enough to ‘futures-proof’ itself. In turn, digitalisation will also play a massive role in meeting public policy objectives. As Jörg sees it, these digital tools will bring more money back to the cities, allowing policymakers to prioritise investments in sustainable mobility. In all the debates regarding new mobility, refinancing is hugely important, and this money will need to come, in part, from OEMs supporting the digital tools that will allow smarter ways of selecting multimodal services.

Adopting the Agility of a Startup

As Philipp Grosse Kleimann reminded the panelists and participants alike, 70% of the world’s population is projected to live in cities by the year 2050. With this in mind, how can OEMs be part of a holistic mobility ecosystem in cities?  For Martin, it is by adopting the agility and speed of a startup that OEMs will be able to adapt to current and future changes in the industry.

In practice, this flexibility means a broad approach to the industry. “Because we do not know what the world of mobility will look like in 50 years, and because we are in this complete dramatic shift as an industry, big players cannot neglect going in all directions” said Martin. As technologies change and evolve, and new demands are created, a startup mentality will allow OEMS to focus on the leading solutions that will begin to emerge. For Nissan, this initial breadth means having the dexterity to go beyond one single vehicle or engine and create business models behind an entire concept. “What we know intimately are the cities and customers,” said Ivan. “So, we have to provide the right product by being flexible – we must be able to adapt, because the needs and changes are ongoing.” Albeit a startup response rate is not simple for large organizations with many years of hierarchical operations under their belts, those that are able to pivot relatively quickly have a stronger chance of being integral to the transformations to come.

There is no One Way Forward

As a backdrop to the entire discussion were 5 identified archetypes that OEMs could play in the new mobility ecosystem, provided by Siemens Advanta. As Philipp expressed, the majority of these possible archetypes depend on sharing – where, he says, developing and building just a car will obviously not be enough. While all the panelists concluded that the car will continue to be central to future mobility, they were also in agreement that this will manifest in very different ways. For James, although the car may remain the primary mode of travel, as the sector shifts, it will be changing the type of car, as well as how we use it, that will be fundamental to managing a complex new mobility ecosystem. How those ecosystems function will be very different depending on local needs and circumstances.

As consumer demand continues to change, these changes must be aligned with public policy objectives, which presents a real opportunity for OEMs to turn these objectives into business for cities. “If OEMs can manage to do this via a city by city approach, and to actually make the city money, then their models are more likely to be adopted,” explained Jörg. Although individual car owners will be a part of a new mobility future, one ‘fits-all’ OEM is far away from being able to work for the complex ecosystems to come. Without having an approach to cities that incorporates hybrid models of partnership and intelligent systems, the future of OEMs is sure to be very difficult. In concluding the panel, Philip re-emphasized that the future of mobility will be diverse, with multiple business models that will succeed. With such a vast number of services to be provided, and many adjacent industries such as power utilities and big tech pushing into mobility, the ability for OEMs to move quickly and collaborate will be key.

Click here to watch a recording of “OEMS Now or Never: How to Embrace New Mobility” held in partnership with Siemens Advanta Consulting.

Key Takeaways from past Virtual Workshops:

Key Takeaways from the Virtual Workshop “How Europe is Moving MaaS – and Vice Versa”

Key Takeaways from the Virtual Workshop “Mobility as a Public Service: Sustainable, Agile, & Resilient Platform Experiences for Cities”

Key Takeaways from the Virtual Workshop “The Future of MaaS: Private Means to Public Ends?”