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A critically important dialogue is occurring across the extended global automotive industry about the future of transportation and mobility. Signals point to a transformation that’s already well underway.

The global automotive industry may be on the verge of a fundamental transformation, giving rise to a new mobility ecosystem. These changes could have far-reaching implications for how we move from point A to point B, and for stakeholders far beyond the auto industry, including gas companies, retailers, insurers, emergency rooms, advertisers, and government regulators.

We might be forgiven for thinking these shifts will materialize only in the distant future, making strategic changes today premature. But the future of mobility is already influencing how businesses operate in an array of industries. Consider:

As of December, Google's self-driving cars have completed more than 1.3 million miles of autonomous driving on public streets.¹

In October, Tesla offered owners the capability to download over-the-air software to enable their vehicles to operate with “pilot assist”—a form of semi-autonomous drive—the first commercially available vehicle to do so.

Several companies developing autonomous cars have indicated they would accept liability should their vehicles crash—a sign of their confidence in the technology and an important development for insurers and the general public.

AT&T added over a million new connected cars in its third quarter, more than any other wireless category, including smartphones.

In January, General Motors announced a $500 million investment in ride-sharing provider Lyft, and plans to use this strategic relationship as the foundation to develop autonomous shared vehicle offerings.

The list goes on, and these developments represent significant advances toward the emergence of a new mobility ecosystem.

The changes are being driven by a series of trends—some technological, some social—that collectively may be poised to fundamentally transform how people and goods move about. New powertrain technologies, including electric vehicles, offer lower emissions with increased range. Advanced materials can reduce weight without sacrificing performance. Vehicles are increasingly connected to other vehicles and infrastructure, with autonomous cars already on the roads. And long-held attitudes about vehicle ownership may be beginning to shift as the notion of shared access becomes more accepted.

These trends converge around a series of distinct but coexisting futures. For those who continue to drive their own vehicles, the future may look much like today, even if these vehicles will be smarter and reduce the number of human-induced accidents. However, it is quite likely the cost of insurance will rise for this segment since they will be the proximate cause of accidents in the future. At the other extreme is the most transformative future state, which could be radically different from today: A world of shared, autonomous cars where crashes are exceedingly rare, traffic abates as throughput increases, and commutes are used by occupants more productively for work or leisure.

Importantly, we argue that these different future states will coexist, compelling companies to consider how to transform in response to each. And there will likely be massive downstream shifts on the extended industry; insurance, finance, energy and fuel, taxes, roads, parking, traffic enforcement, public transportation, and even health care will all be affected.

In the future mobility system, the needs around which today’s industries were built remain, but much more fluid ecosystems will likely emerge to serve them. This por­tends significant change to current business models, and partnerships—such as between incumbents and disruptors—will be critical to deliver new mobility solutions.

Competing effectively in the future mobil­ity ecosystem requires building new and different capabilities. Everyone in today’s extended automotive sector needs to reas­sess how they will operate and create value while the future states coexist and, in the longer term, when autonomous and shared mobility become more mainstream.

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—by Scott Corwin, director, Strategy & Business Transformation practice, Deloitte Consulting LLP; Philipp Willigmann, senior manager, Strategy practice, Monitor Deloitte; Elizabeth Berkey Cathles, manager, Strategy & Operations practice, Deloitte Consulting LLP

1. Google Self-Driving Car Project Monthly Report, December 2015.

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