Thoughts, Insights and Inspiration

Is ‘Mobility’ the Future of the Automotive Industry?

Cars have been a part of our everyday lives in the western world for around a century now, with levels of car ownership rising as more and more of us can afford to buy them. Official automotive industry statistics showed in 2016 that there were more than 36m vehicles licensed to drive on the roads in the UK, with an estimated 261m in the USA. However, we are approaching a time of unprecedented change and potential opportunity, so is ‘mobility’ the future of the automotive industry?

What is ‘Mobility’?

In 2015, Ford President and CEO Mark Fields made a speech at the Consumer Electronics Show that was meant to usher in a new era for the way we use cars. He unveiled the Smart Mobility plan, which talked about connectivity, autonomous vehicles, the customer experience and big data as the cornerstones of how Ford would do business in a changing world.

The definition of ‘Mobility’ in this context primarily means car sharing, a market that has been booming and is predicted to become even bigger. A report from Global Market Insights in March claims that the car sharing market in the States would grow to $16.5bn by 2024, driven by government regulations on emissions, petrol prices, and the new technologies out there to facilitate sharing.

Another report by McKinsey & Company in January 2016 predicted the further rise in car pools and sharing at the expense of rises in car sales, stating: “Overall global car sales will continue to grow, but the annual growth rate is expected to drop from the 3.6 percent over the last five years to around 2 percent by 2030. This drop will be largely driven by macroeconomic factors and the rise of new mobility services such as car sharing and e-hailing.”

So where does this leave a multinational car manufacturer like Ford? For Fields, it’s all about pushing the envelope and adapting to the way vehicle usage is changing.

“Even as we showcase connected cars and share our plans for autonomous vehicles, we are here at CES with a higher purpose,” Fields said. “We are driving innovation in every part of our business to be both a product and mobility company – and, ultimately, to change the way the world moves just as our founder Henry Ford did 111 years ago.

“The existing infrastructure for motor vehicles simply cannot sustain the sheer number of vehicles expected to be on the road in the coming years,” he continued. “Our roadmap has to include not only smarter cars, but smarter roads and smarter cities.

“We see a world where vehicles talk to one another, drivers and vehicles communicate with the city infrastructure to relieve congestion, and people routinely share vehicles or multiple forms of transportation for their daily commute. The experiments we’re undertaking today will lead to an all-new model of transportation and mobility within the next 10 years and beyond.”

What Happened Next?

The ‘experiments’ Fields talked about were 25 trial projects around the world which were designed to anticipate customer demands and requirements in those areas in the future. These included a predictive parking scheme in London, a ‘dynamic social shuttle’ in New York and a scheme to capitalise on car sharing trends in Bangalore, India.

Some of these have led to longer-term schemes, and in 2016 Ford invested in a shuttle-van start-up and a bike-share program in San Francisco, as well as announcing that they planned to have self-driving shared-ride vehicles on the roads by 2021. However, things haven’t quite gone according to plan, with Ford stock down 40% since Fields was appointed, and chairman Bill Ford said that the company had been split by his “one foot in today one foot in tomorrow” plans.

Fields paid the price for his perceived failures in May when he was fired by Ford, with Wired summing up the scepticism the industry (and presumably his employers) had for his vision of the future: “If there’s one takeaway from Ford ditching Fields, it’s that in our current transportation environment, ‘mobility’ isn’t so much a strategy as it is a euphemism for ‘we have no idea what’s happening next.’”

What Is The Future Of Mobility?

The dismissal of Fields shouldn’t be taken as a sign that Ford has ditched mobility altogether. For one thing, his replacement is Jim Hackett, who had been leading on the company’s mobility strategy, including the smart and driverless car division. So his appointment indicates that Ford is still planning to keep moving in that direction, even without Fields at the helm.

Bill Ford summed up the position the company finds itself in now in his announcement of the new CEO: “A time of unprecedented change for the industry is here now. Jim is a proven transformational leader, a visionary thinker. He’s not just a futurist, he is a great operating executive able to seamlessly deliver a future that has been envisioned.”

The onus is on Hackett to find a better way than Fields to balance the push towards a future of greater mobility and new technology with the existing challenges that Ford faces in the current market. For all car manufacturers, the future remains one full of uncertainties about how they will continue to thrive if we start to share cars rather than buying them in the numbers we have over the last few decades. The companies who adapt best to the changing circumstances will be the ones that survive the big changes ahead.

What do you think of mobility? Is it the future of the automotive industry, or just a fad that distracts from the here and now? Start the conversation online @mporiumgroup and subscribe to our blog for more fascinating articles and insight.

From our Blog