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In March 2015, it was widely reported that driverless cars are set to accelerate growth in the British automotive industry. A report, published by KPMG on behalf of trade body The Society of Motor Manufacturers and Traders, suggested that by 2030 driverless cars could create 320,000 jobs in the UK, add £51 billion to the country’s economy and prevent 25,000 serious accidents. While these figures are positive in their initial outreach for the automotive industry and for road users more generally, the impact this will have on the aftermarket segment is unclear.
The growth of driverless cars could open new opportunities for the aftermarket industry and require new and innovative solutions from OEMS and their supply chain providers. These vehicles are set to be increasingly reliant on technology that will likely require updates after purchase as these systems become more advanced. Will it be common to upgrade over the air as we do with our mobile phones? If not, will the aftermarket need to change their business models for improved customer service levels? Will it be possible to shorten the supply chain and enable work to be carried out at the consumer’s work or home, opposed to the driver having to take their vehicle into the garage? This change could improve customer loyalty in the longer term as it become more convenient to consumers. It may also be important to consider if consumers will be comfortable upgrading via mobile technology? Whilst we see no problem in updating software on our mobile devices, drivers may have a different opinion when carrying out changes that could affect the safety of the vehicle and those inside.
A large portion of OEMs revenue can be made through aftermarket sales including the replacement of parts damaged during collisions, and with driverless vehicles set to reduce the number of these collisions – a truly positive development for road safety – this could in turn reduce the need for replacement parts. However, many parts will still be required – for example, autonomous vehicles are unlikely to remove the chance of an engine failing or a scratch being inflicted on the body work by a pedestrian in the car park.
In other sectors such as the retail market, consumers are demanding to get their goods delivered in the quickest possible time and in a place that suits them. The logistical operations that supports this demand is becoming ever more complex but at the same time has to deliver increased efficiencies as consumer choice grows. If the rise in autonomous vehicles does indeed decrease the number of aftermarket parts or services required, I expect we will see increased collaboration in the automotive sector too.
As these new technologies develop in the next decade manufacturers and logistics providers must prepare to adapt to change. Automation itself is not new to DHL, some warehouse operations have been using self-driving vehicles to some extent for years, but making driving in logistics more and more autonomous will change the logistics sector dramatically. Our trend team has published the report ‘Self-Driving Vehicles in Logistics’, highlighting the key elements and significant potential of autonomous technologies in the logistic industry. It’s well worth a read.
With these new advances in technology and the impact of this on the automotive sector, the role a logistics provider plays can become critical to the success of the customer. We have been working with our customers for decades and will be ready to adapt with them as we move into the future of aftermarket sales. These developments may change the way we drive and the way we, work but their full impact, is yet to be seen.
By Bill Bacon, MD Automotive UK, DHL Supply Chain