Dusseldorf, Frankfurt Managers from the German car manufacturers Volkswagen, BMW and Mercedes had a lot to admire at the auto show in Shanghai. At the stands, people didn’t talk shop about gap dimensions and brag about horsepower. The exhibition was characterized by electric vehicles – and the biggest selling point was the software.
The cars of the future will interact with drivers, passengers and the outside world. This goes so far that in the industry people are talking more and more often about the “living space car”. Smart, networked vehicles should do more in everyday life than just getting people from A to B. Above all in China.
In the future, weekend shopping can be done from the car using language assistants and heating, shutters, lights, kitchen appliances or door openers can be controlled in the networked home. The vehicle becomes an entertainment center, a means of payment, a place to sleep and sometimes even a kitchen. This is made possible by rapid development steps in software and electronics.
According to the Oliver Wyman consultant, eight out of ten drivers in China would change brands because of a better infotainment offering. In Europe it would be four out of ten. What used to be labeled Chichi for tech-savvy nerds is now decisive for market shares – because driving a car is changing itself. The triad applies: smartphone, smart home, smart car.
Tesla is considered a pioneer of this development. The electric car manufacturer integrated high-performance computers into its vehicles early on. These were primarily necessary to enable partially automated driving functions. However, Tesla also used the computing capacity to offer entertainment formats in the car, including video games that otherwise only run on consoles such as the Playstation or the Xbox. For example, the time the electric car is plugged into the charging station can be bridged with games like “Cyberpunk 2077” or “The Witcher”.
Entertainment means more than a karaoke function
German car manufacturers cannot keep up, at least when it comes to gaming. In Mercedes’ luxury limousine EQS, for example, the range is already limited to simple games such as Tetris or Sudoku. Volkswagen reacts, but belatedly. The software unit Cariad presented its gaming vision for the first time at the trade fair in Shanghai. Trade fair visitors could try out a prototype. It is unclear when the computer games will find their way into production vehicles from Volkswagen.
The example of China also shows how the use of the car is changing due to the increasing use of software. In this context, German car companies like to use the example of the karaoke function – and smile at it. It’s popular in China, but literally not on the radar of western manufacturers. However, there are developments in the Chinese market that must be taken very seriously.
If necessary, the giant screen shuts down with a sound effect.
(Photo: BMW)
One of the key companies is the network supplier Huawei. In Germany, the group is best known for fears of espionage in connection with the 5G network. In its home market, Huawei is considered an established supplier in the automotive sector and also sells its own cars under the Aito brand.
At an event on the topic of car software in Munich at the end of March, Shang Jiang from Huawei showed how the company imagines the future of a networked car. The company is close to its car users via the Harmony OS operating system. And knows what they want.
“To get in, they could authenticate themselves with their smartwatch,” says Jiang, citing one use case. Individual settings and preferences can then be preset in the car via a personalized login, for example for film and music requests.
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Even the state of health can be tracked via an app while driving. The car would then even be able to recommend a doctor’s visit and book an appointment with a preset specialist and enter this into the calendar, which is synced with the smartphone.
Also popular in China: berths on the back seat and the selfie camera in the interior. Photos of occupants taken while driving can then be shared in digital media. All functions that are still installed in vehicle generations that do not drive fully autonomously. In the future, people will tend to have more time in their cars than before – because they are not busy driving themselves.
The entertainment in BMW’s electric luxury model i7, for example, is geared towards this – the sevens have always been considered chauffeur-driven limousines. Accordingly, the car has a gigantic screen for the back seat. Passengers can watch films in cinema quality on the 31-inch display.
At the Chinese premium car manufacturer Li Auto, inmates have completely different options. A device is installed in the SUV L9, which is otherwise suspected in the kitchen: a kind of oven-fridge combination. Temperatures can be set between 0 and 50 degrees Celsius in a special compartment in the rear row of seats. It can be used to cool drinks or keep take-away food warm.
Open the front door with the car
Linking the car software with smart home devices also offers great potential. For example, according to Huawei manager Jiang, the heating in the apartment or house could be switched on via the language assistant in the car. It would also be conceivable for the networked house to recognize the vehicle as soon as it pulls into its own driveway and the shutters are raised and the front door unlocked. In Germany, Harmony OS is not yet available in cars. “If you want to see all this, please come to China,” Jiang promised.
In the future, the car will also be suitable as a digital wallet. Here, in turn, a German manufacturer is at the forefront: Since March, Mercedes, together with Visa, has been offering drivers of the models of the EQS, EQE, GLC, S and C classes digital services or hardware upgrades directly from the group’s own shop to pay for the car. The driver authorizes the process via a fingerprint sensor in the center console. Soon it will also be possible to pay for the parking lot or to fill up the tank.
In addition to large screens, Li Auto also offers devices in its SUV that are otherwise only known from the kitchen.
(Photo: Bloomberg)
A survey conducted by GfK consumer researchers for Mastercard last autumn throughout Europe shows the potential. 74 percent of those surveyed can imagine paying by car when parking, 72 percent would do so when filling up. The car wash or paying the toll fee is also a possible place of use for the wallet on wheels for many.
“The networked car enables completely new marketplaces and the willingness to use it is there,” says Peter Robejsek, Manager at Mastercard and Country Manager for Germany. The analysts at the Ptolemus Group in Belgium expect that sales of 537 billion euros can be achieved by 2030 in 600 million vehicles worldwide via so-called “in-car payment”.
Advertising companies want to put advertising in the car
Where such lucrative business beckons, advertising is not far away. “We talk to car manufacturers, there are corresponding ideas. Technological development is also going in this direction,” says Tobias Hefele, CEO at Weischer.JvB, a communications agency for the mobile target group.
Two things would drive the topic: the digitization of the car and automated driving. “The more autonomy the car gets, the more opportunities there are for advertising,” says Hefele. What is meant here is personalization, targeted addressing.
Like the smartphone, cars now have data intelligence, for example location information, explains the communications expert the procedure. In this way they are connected to the environment. “That makes it possible to send local offers to the vehicle’s display.” So it’s not about running broad advertising campaigns on car screens.
Audi provides a foretaste of this new car world. The company works with 4.screen, a company specializing in in-car marketing. If an Audi driver is looking for an organic market in the navigation system, nearby dealers can draw attention to themselves and special offers in the display. Of course, the whole thing will not happen without approval, emphasizes Audi.
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Hefele can imagine other scenarios. The driver of an e-car wants to go shopping and the battery has to be charged for 30 minutes. “A retailer tells him that his purchase will probably only take 25 minutes and offers, Have a free coffee at my place.”
The communications specialist does not see any major obstacles to acceptance. “As a driver, I have to wait at the traffic light, so advertising, unlike during a TV film, is not immediately perceived as annoying.” It can even be perceived as a welcome distraction, as long as it is done well. Even a real equivalent value is conceivable: “I can imagine that customers get discounts on certain upgrades if they allow advertising in the car. Such subscription models have existed outside of the car for a long time.”
And it is not for nothing that the German car manufacturers in particular insist on retaining sovereignty over their data when it comes to technical cooperation with global corporations such as Google or Apple.
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