Global Automotive Executive Survey 2018 In every industry there is a next See it sooner with KPMG

Transcription

1 KPMG s 19 th consecutive Global Automotive Executive Survey 2018 In every industry there is a next See it sooner with KPMG Ricardo BACELLAR KPMG Brazil Head of Automotive Mar / 2018

2 We have what to celebrate... 2

3 ... But there s much more to be done! 3

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14 About the executive survey TOP 5 RESPONDENTS - EXECUTIVES 135 China Sweden 37 Norway 44 Denmark 2 Germany 49 Austria 5 Switzerland 5 Netherlands 7 Belgium 4 For the 2018 survey we gathered the opinions of more than 900 executives from 43 countries. 4 Czech Republic 7 Poland 6 Hungary 5 Romania 3 Finland 22 Turkey 25 Russia 98 Brazil 89 USA 50 Japan Canada 7 Mexico 23 Ecuador 1 89 USA UK 49 France Italy Spain Morocco 5 16 Colombia 98 Brazil Nigeria 1 10 Iran 12 SaudiArabia China Japan SouthKorea Taiwan India Vietnam Philippines Thailand 14 Malaysia 19 Indonesia 49 Germany 49 UK 16 Argentina Western Europe 14 SouthAfrica North America Mature Asia 4 Australia India & ASEAN Eastern Europe South America China Rest of World Note: Map shows number of respondents from each country Source: KPMG s Global Automotive Executive Survey

15 Key trends until KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 15

16 Key trends until 2025 GLOBAL # Percentage of executives rating a trend as extremely important # 1 # 1 # 1 # 1 # 1 # 1 Fuel cell electric vehicles (FCEVs) 52% # 2 # 2 # 2 # 2 # 2 # 2 Connectivity and digitalization 50% # 3 # 3 # 3 # 3 # 3 # 3 Battery electric vehicles (BEVs) 49% # 4 # 4 # 4 # 4 # 4 # 4 Hybrid electric vehicles (HEVs) 47% Ranking # 5 # 6 # 5 # 6 # 5 # 6 # 5 # 6 # 5 # 6 # 5 # 6 Market growth in emerging markets Creating value out of big data 47% 44% # 7 # 7 # 7 # 7 # 7 # 7 Mobility-as-a-service/Car sharing 43% # 8 # 8 # 8 # 8 # 8 # 8 Autonomous and self-driving cars 41% # 9 # 9 # 9 # 9 # 9 # 9 Platform strategies and standardization of modules 40% # 10 # 10 # 10 # 10 # 10 # 10 Downsizing of internal combustion engines (ICEs) 35% # 11 # 11 # 11 # 11 # 11 # 11 Rationalization of production in Western Europe 31% Source: KPMG s Global Automotive Executive Survey

17 Key trends until 2025 BRAZIL # Percentage of executives rating a trend as extremely important # 1 #1 #1 #1 Connectivity and digitalization 73% # 2 #2 #2 #2 Mobility-as-a-service/Car sharing 69% # 3 #3 #3 #3 Fuel cel electric vehicles (FCEVs) 69% # 4 #4 #4 #4 Market growth in emerging markets 62% Ranking # 5 # 6 #5 #6 #5 #6 #5 #6 Creating value out of big data Autonomous and self-driving cars 62% 58% # 7 #7 #7 #7 Battery electric vehicles (BEVs) 54% # 8 #8 #8 #8 Platform strategies and standardization of modules 50% # 9 #9 #9 #9 Hybrid electric vehicles (HEVs) 46% # 10 #10 #10 #10 Rationalization of production in Western Europe 46% # 11 #11 #11 #11 Downsizing of internal combustion engine (ICE) 35% Source: KPMG s Global Automotive Executive Survey

18 The auto industry has to transform the business Total market capitalization (in $bn) Source: 2016 KPMG CEO Outlook 18

19 The auto industry has to transform the business Total cash position (in $bn)

20 Business Ecosystem Transformation 2018 KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 20

21 Digital Disruption has dramatically changed the Business Environment Enterprise Digital Transformation Digital Customer Engagement Digital Marketing Activity was centered on front office and customer experience Consulting firms created digital practices through strategic acquisitions A digital focus on just the front office will not provide sustainable competitive advantage Organizations must focus on restructuring operations beyond customer-facing functions to enable enterprise-wide digital transformation Digital Business Strategy Omni- Business Mobile Digital agencies entered the market and played a big role Organizations plan to spend more on digital in the middle and back office than the front office Digital Supply Chain Disruptive Business Models 21

22 Asset Light Digital disruption is the change in form and substance that occurs when new digital technologies and mental models which create new business models with value propositions that exponentially challenge existing goods and services. Data Rich Customer Centric Platform Based 22

23 The Future Auto Industry Electric Vehicles & Alternative Powertrains Mobility Value Chain Changing consumer and societal demands Moving people Moving goods Connected and Autonomous Vehicles Mobility as a Service (MaaS) Collaboration in the future Mobility Ecosystem Source: 2017, KPMG, Global Automotive Executive Survey 23

24 The auto industry has to transform the business 78% of global automotive executives would choose an electric car if they were to buy a car over the next 5 years. Data is the fuel for future auto business model for 83% automotive executives By 2020, more than 90% of cars sold will be connected Conhecimento da Indústria By 2020, more than 90% of cars sold will be connected Digitalization will drive more innovation in the next 20 years than there was been in the past 100 years. 50% of global consumers consider privacy & security as an extremely important purchasing criteria. 80% of global consumers expect the OEM to take care of charging stations. Source: 2016, WEF, Digital Transformation of Industries: Automotive and 2017, KPMG, Global Automotive Executive Survey 24

25 The auto industry has to transform the business 83% believe there will be a business model disruption in the next 5 years 84% agree that digital ecosystem will generate higher revenues in the automotive value chain than the hardware of the car itself. 75% say that measuring market shares simply based on unit sales is outdated. Source: 2016 MIT Sloan Management Review,. Aligning The Organization For Its Digital Future 81% agree that if OEMs don't have a structured approach to integrate or cooperate with innovative startups, they will fail KPMG CEO Outlook Source: 2016, Rogers D. The Digital Transformation Playbook 25

26 The auto industry has to transform the business 91% 74% 99% 85% 37% 47% Consider cooperation / partnership with other industries Believe the number of physical retail outlets will be reduced by more than 20% by 2025 Agree that OEMs can monetize data from connected cars Agree that OEMs that will not emphasize on data & cyber security have a high risk to sacrifice their brand reputation Consider the OEM will own / take over the customer relationship until 2025 About half don t think an OEM will be the best option to provide a better car sharing experience Source: 2016 KPMG CEO Outlook 26

27 The actual ecosystem DOWNSTREAM Fuel Retailer UPSTREAM Customer Government Insurance Finance End of Life Raw Material Supplier Tier II Tier I Spares Labor Remarket OEM Dealer Car Workshop Source: 2017, KPMG, Global Automotive Executive Survey 27

28 The new ecosystem 85% of executives agree that the digital ecosystem will generate higher revenues than the hardware of the car itself. DATA AGGREGATOR Other Cars DOWNSTREAM Other Models Infrastructure UPSTREAM Customer EXPERIENCE AGGREGATOR Retail Media Other Services Raw Material Supplier Tier II MOBILITY SERVICE PROVIDER Vehicle Management as a Service End of Life Tier I OEM Car Fuel or Energy Finance Insurance Service & repair Source: 2017, KPMG, Global Automotive Executive Survey 28

29 The new ecosystem 29

30 New value drivers Measuring success based on unit sales is outdated. Management according to Product profitability is over Customer value will become core focus CUSTOMER JOURNEY INFOTAINMENT 60% of customers agree when buying a selfdriving car that they will only be interested in what they can do with their time in the car. Possible applications, for example, include online maintenance (updating software remotely), selfdiagnosis ( ) provided to the client via the cloud PREDICTIVE MAINTENANCE DATA MARKETPLACE 84% of executives agree that data is the fuel for the future business model of auto companies. Source: 2016, WEF, Digital Transformation of Industries: Automotive and 2017, KPMG, The Connected Car Is Here To Stay 30

31 NEW business partnerships / revenue streams 31

32 NEW business partnerships / revenue streams Source: 2016, WEF, Digital Transformation of Industries: Automotive and 2017, KPMG, The Connected Car Is Here To Stay 32

33 NEW KPIs GROWTH PROFITABILITY SUSTAINABILITY Revenue Passenger Miles Passenger revenue per available seat mile Churn Recurring Revenue Revenue per available seat mile Sales Effectiveness Cost per available seat mile Number of Active Customers Customer acquisition costs User Adoption Recurring Margins Source: 2016, WEF, Digital Transformation of Industries: Note: Automotive Percentages may not add up to 100 % due to rounding Source: KPMG s Global Automotive Executive Survey2017 and 2017, KPMG, The Connected Car Is Here To Stay 33

34 Three core elements for new clockspeeds: Data & Analytics 2018 KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 34

35 Data supremacy Data is the fuel for the future business model of automotive companies. GLOBAL BRAZIL 83% 11% 6% 88% 8% 4% Agree Neutral Disagree Agree Neutral Disagree 35

36 Automotive Data & Analytics Use Cases Incentives Optimization Service Marketing for Retention Model Churn Prediction Detractor Prediction Lease Term Optimization Dealer Effectiveness Enhancement Advanced Customer Segmentation and Targeting Predictive Engagement In-Market Customer Identification Marketing Attribution Marketing Mix Optimization Predictive Maintenance Workforce Optimization MRO Spend Optimization Demand Forecasting Supply Risk Monitoring Supply Constraint Prioritization Production Optimization Parts Inventory Optimization Real-Time Quality Issue Identification Issue Impact Analysis Predictive Warranty Issue Identification Vehicle Testing Optimization Turnover Analytics Workforce Optimization Forecast Accuracy Improvement Vehicle, Parts and Service Contract Pricing Optimization Parts Inventory Optimization Vehicle Buy-Back Prediction Portfolio Optimization Feature/Function Packaging Customer-Driven Product Design Usage-Based Product Design Spend Analytics Vendor Risk Predictive Modeling Supplier Relationship Management 36

37 Benefits Auto & Manufacturing Companies Achieve from Analytics 1% increase in OEM s customer loyalty is worth $700 million OEM aims to increase by 7 points 20% reduction in warranty cases per vehicle through advanced pattern detection Spare parts inventory optimization 30-60% reduction in inventory levels 18% reduction in replenishment levels 50% reduction in defect rate in production using predictive analytics 80% reduction in scrap rate in 15 weeks from enhanced root cause analysis 25% reduction in direct maintenance costs using cost and availability modeling Improved production effectiveness using optimization analytics 30% increase in potential production capacity 90% increase in schedule adherence using production scheduling and sequencing optimization Optimized extended warranty contract pricing using predictive cost modeling Mid-cycle product change prompted by social media feedback Source: IBM, KPMG 37

38 Data supremacy Connected cars generate an enormous amount of consumer & vehicle data. Who do you think will be the owner / guardian of the consumer data in 2025? GLOBAL GLOBAL BRAZIL BRAZIL 34% OEM 17% 19% OEM 23% 25% Owner / Driver of the car 45% 45% Owner / Driver of the car 51% 18% ICT companies 12% 13% ICT companies 18% 9% Supplier 7% 15% Supplier 2% Mobility 6% solutions 7% provider Mobility 4% solutions 4% provider Retailer / 5% 6% 4% Retailer / 1% car dealer car dealer 38

39 Three core elements for new clockspeeds: IA & Digital Tools 2018 KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 39

40 Customer centricity Imagine you are sitting in your car and you have turned on your in-car navigation system and your smartphones navigation app with traffic info. The in-car navigation system tells you it would be favorable to take a right, while your smartphone tells you to take a left. Which information would you rather trust and follow? GLOBAL BRAZIL 59% 41% 65% 35% That of your car That of your smartphone That of your car That of your smartphone 40

41 Customer centricity At the heart of relationship building we have the customer journey mapping technique, connecting every single point of contact between the brand and its customers interest Decision Usage research Buy Sale 41

42 Customer centricity Expectations Customer: Joseph (young single designer) Usage: driving to work integrity Customer: Joseph (young single designer) Usage: driving to the beach on weekends Customer: Rose (young married nurse) Usage: driving to the beach on weekends Customer: Rose (young married nurse) Usage: driving to work Resolution Empathy Time & Effort Personalization 42

43 Ecosystem Datacentric ecosystem mobile e-coins e-wallets Media News EaD insurance retail marlketing Automotive Digital Data Gateway Standards Cyber Sec Data Governance Telco Providers $ Payments Contents Providers Data users Open Digital Platform Sensor Geospatial Visual Consumption Health Media Interaction behavior Cognitive Consumer Things Apps Fleet B2B Parking Diagnostics Sharing Location Interaction Health Entertainment Utilities Maintain Management Tracking Logistics Security 43

44 Three core elements for new clockspeeds: Cyber Security 2018 KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 44

45 Data supremacy Companies that will not emphasize on data & cyber security have a high risk to sacrifice their brand reputation and value proposition for zero-error tolerance and releasability. GLOBAL BRAZIL 85% 8% 7% 87% 9% 4% Agree Neutral Disagree Agree Neutral Disagree 45

46 Data supremacy How important is data privacy & security for you as a purchasing decision of a vehicle / to use of a mobility service over the next 5 years? GLOBAL BRAZIL Extremely important 49% 72% Extremely important Somewhat important 28% 18% Somewhat important Neutral 16% 9% Neutral 3% Somewhat unimportant Somewhat unimportant 1% 4% Not at all important Not at all important 1% 46

47 Cyber Security A crescente complexidade da tecnologia do veículo tem inúmeros benefícios, mas, ao mesmo tempo, cria um risco real de ataque cibernético - um risco que tememos e que muitas empresas da indústria automotiva possam estar subestimando. Veículos Conectados Hubble telescope Boeing 787 F-35 fighter Windows 7 Hadron Collider Facebook Space shuttle Android Encontrar e corrigir vulnerabilidades no hardware e software incorporados dentro de carros individuais continuará a persistir como uma questão chave para as montadoras. No entanto, pensamos que há um risco adicional que as montadoras precisam abordar - um risco que vai muito além da ameaça cibernética tradicional de ataques de veículos, que tem sido o foco de grande parte da conversa de segurança cibernética na indústria até aqui. Esse risco é o potencial hacking de frotas inteiras Linhas de código (M) 47

48 Cyber Security Superfície de Ataque em Veículos Conectados INTEGRAÇÃO COM PROCESSOS DE SEGURANÇA CIBERNÉTICA OPERAÇÃO E MONITORAÇÃO DE SEGURANÇA PRIVACIDADE DOS DADOS Cellular 3G/4G Web-based services XM GPS Bluetooth BLE NFC Wi-Fi INTEGRAÇÃO COM PARCEIROS E TERCEIROS Wireless sensors (e.g., TPMS, RKE) Radio SEGURANÇA NO DESIGN Electric vehicle charging station GOVERNANÇA DE SEGURANÇA DA INFORMAÇÃO Internal propagation of attacks introduced via USB, SD, Disc, etc. V2I-DSRC Counterfeit parts SEGURANÇA NA PRODUÇÃO / LOCALIZAÇÃO 48

49 Powertrain technologies 49

50 Electric readiness Executive opinion (BEVs) Battery Electric Vehicles will fail due to infrastructure challenges. (FCEVs) Fuel Cell Electric Vehicles will be the real breakthrough for electric mobility. GLOBAL Absolutely agree 22% 33% Absolutely agree Partly agree 40% 45% Partly agree Neutral 20% 16% Neutral 12% Partly disagree Partly disagree 5% 6% Absolutely disagree Absolutely disagree 1% 50

51 Electric readiness Pure battery electric vehicles (BEV) will fail due to the challenges related to setting up the required infrastructure. GLOBAL BRAZIL 54% 15% 31% 64% 9% 26% Agree Neutral Disagree Agree Neutral Disagree 51

52 Electric readiness If I buy an electric vehicle I expect the manufacturer of the car to take care of all matters around charging. GLOBAL BRAZIL Absolutely agree 45% 69% Absolutely agree Partly agree 35% 22% Partly agree Undecided 14% Undecided 7% 4% Partly disagree Partly disagree 2% 2% Absolutely disagree Absolutely disagree 0% 52

53 Electric readiness OEMs strategies with regard to charging will be... GLOBAL BRAZIL 81% 19% 77% 23% OEMs create their own charging ecosystem with proprietary technology and services OEMs will not need to take care of the charging infrastructure OEMs create their own charging ecosystem with proprietary technology and services OEMs will not need to take care of the charging infrastructure 53

54 Electric readiness Internal combustion engines (ICE) will still be more important than electric drivetrains for a very long time. GLOBAL BRAZIL 76% 12% 12% 69% 15% 16% Agree Neutral Disagree Agree Neutral Disagree 54

55 Electric readiness FCEV What is your opinion on the share between ICE, Hybrids, BEV & FCEV in 2030 and 2040? BEV Hybrids GLOBAL BRAZIL ICE CAR VOLUME M 90% (4M) M 21% (26M) 24% (30M) 24% (29M) 30% (37M) M 25% (35M) 26% (37M) 24% (34M) 25% (35M) CAR VOLUME South America 4.36M 90% (4M) 5.90M 21% (1M) 19% (1M) 24% (1M) 36% (2M) 6.94M 22% (2M) 22% (2M) 24% (2M) 25% (35M)

56 Closing 2018 KPMG International Cooperative Note: ( KPMG Percentages International ). may KPMG not add International up to 100 provides % due to no rounding client services Source: and is KPMG s a Swiss Global entity with Automotive which the Executive independent Survey2017 member firms of the KPMG network are affiliated. 56

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59 Thank you Ricardo BACELLAR Head of Automotive KPMG in Brazil (21) The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation KPMG International Cooperative ( KPMG International ), a Swiss entity. Member firms of the KPMG network of independent firms are affiliated with KPMG Inter- national. KPMG International provides no client services. No member firm has any authority to obligate or bind KPMG International or any other member firm vis-à-vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International.