Automobile big data: Opportunity for improved vehicle experience and monetization
Automobile big data: Opportunity for improved vehicle experience and monetization
Automobile big data: Opportunity for improved vehicle experience and monetization
- Author:
- January 26, 2022
Insight summary
Vehicle connectivity is enabling cars to collect and share various information, including biometrics, driver behavior, and vehicle performance. This wealth of data not only offers automakers insights into safety enhancements and business intelligence but also holds significant economic potential, with the monetization of vehicle data projected to generate hundreds of billions of dollars globally. Furthermore, the rise of vehicle connectivity has spurred growth in the automotive cyber security market, highlighting the importance of securing this data.
Automobile big data context
Vehicle connectivity enables automobiles to gather and distribute a wide range of data. This data, which includes biometric information, driver behavior, vehicle performance, and geolocation, is shared with both vehicle owners and manufacturers. Over the past few decades, the declining costs of computing and sensor technologies have made it feasible for automakers to integrate these advanced sensor systems into their vehicles.
The data generated by these sensors offers a wealth of opportunities for automakers. It can provide insights into potential safety enhancements, offer valuable business intelligence, and suggest new ways to deliver added value to customers. Furthermore, the monetization of vehicle data on a global scale could contribute significantly to the economy. By 2030, it is projected that this could generate between USD $450 and $750 billion.
In addition, the market for automotive cyber security is also experiencing significant growth. In 2018, the global market size for automotive cyber security was valued at USD $1.44 billion. This market is expected to expand at a compound annual growth rate of 21.4 percent from 2019 to 2025.
Disruptive impact
Automotive big data can help automakers gain insights into vehicle intelligence and extract value from it. This data can serve as a major driver to save costs in the automotive industry. In addition, a potential short-term connected data use case involves the early detection of anomaly and root cause analysis using on-the-road vehicle sensor data. For example, connected vehicles can send regular sensor updates to their manufacturer.
The manufacturer can leverage the data to swiftly to accurately detect anomalies. This functionality enables quick fixes in new production lines and improves vehicle uptime metrics for customer satisfaction. In essence, automotive data is rapidly becoming an essential input and competitive advantage for developing new products and quality assurance.
Aside from automakers, organizations in the transportation industry, such as Uber, can also benefit from automobile data. These organizations can use this data to improve customer experience and increase profitability. For example, Uber uses its app to record the activities of the driver behind the wheel. These activities may include where the driver went, the amount of money made, and the ratings given by the customer. In addition, more specific automobile data can be collected such as the number of rides accepted and canceled, where trips started and ended, and the time it took the driver to wind through traffic.
Implications of automobile big data
Wider implications of automobile big data may include:
- Collecting useful data such as drivers' experience, causes of potential vehicle failures, and inherent vehicle conditions through vehicle connectivity.
- Real-time data collected from vehicles helping automakers identify problems early.
- Predictive analytics from installed apps and software that can allow companies to recall faulty vehicles, thereby getting out of potential warranty.
- Helping automakers and auto dealers optimize their vehicle parts inventory and technician resourcing strategies.
- Providing city planners with data to design safer and more efficient roads, highways, and traffic systems.
- Governments increasingly being able to set vehicle safety and manufacturing standards based on vehicle usage data.
- Increasing vehicle cyber attacks, prompting a demand for better cybersecurity solutions.
Questions to consider
- How can automakers motivate consumers to pay for connected data services?
- How can automakers protect consumer data or avoid consumer data compromises?
Insight references
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