ACME, MI – The Center for Automotive Research’s Management Briefing Seminars (MBS) is an annual rite of summer for the auto industry. Representatives of automakers and suppliers head to northern Michigan near the resort town of Traverse City for lectures and presentations about the industry.
This year’s edition, however, is more of a mobility conference. Mobility is a catchall phrase for changes such as self-driving cars, ride-sharing services and “electrification” of vehicles (pure electric vehicles and hybrids).
For example, the first speaker at this year’s MBS was Danny Stillion, executive design director of IDEO, a design consulting company.
“The end of the ICE age is upon us,” Stillion said. In this case ICE stands for internal combustion engine. In a slide accompanying his presentation, he provided another acronym, CASE, for “Connected + Electric + Shared + Electric.”
Not everyone buys into such a rapid pace of change. Jeff Schuster, president of LMC Automotive’s Americas operation, reacted real time on Twitter to Stillion’s talk.
Referring to the end of the internal combustion engine, Schuster wrote on Twitter: “I would agree only if you define ‘end’ as 30-50 years from today.”
Eaton Corp. is a traditional automotive supplier that earlier this year formed an e-mobility business. That involved combining products and plants from its electrical and vehicle units. The company said it plans to invest more than $500 million over the next five years to develop new products for vehicle electrification.
“We don’t believe there’s a near-term risk” to the internal combustion engine, said Scott Adams, an Eaton senior vice president.
At the same time, Eaton saw an opportunity “with our knowledge of regulating electric power” in vehicles, said Adams, who is attending MBS. “The amount of activity across the globe is extremely high.”
A shift is underway mostly because of industry trends.
‘ What Everybody Is Talking About’
“Mobility is what everybody is talking about, what everybody is investing in,” said Michelle Krebs, executive analyst with Autotrader who is attending MBS. “Nobody really knows what’s going to happen. Everybody’s in the game.”
One reason for all the industry bets is the rise of millennials born between 1981 and 1997.
“This is a group that grew up with technology,” said Anupam “Pom” Malhorta, director of connected vehicles and data for Audi of America. It’s a generation more comfortable with tech and more open to new ideas beyond traditional vehicle ownership, he said.
“All of that becomes something we have to talk about,” Malhorta said during an MBS presentation.
Of the CASE acronym, “Connected is mainstream today,” he said. Cars can receive and send data. That also “builds a foundation for other” automotive technology, the Audi executive said.
The push for more electric powertrains also is underway because of regulatory pressures. The Trump administration has indicated it’s looking to ease up on fuel efficiency standards. But China and Europe aren’t.
As a result, automakers are looking for more electric powertrains for vehicles because they sell globally. Malhorta referred to electrification as a “near term, high disruption” factor for the industry.
Longer-term trends are self-driving and “shared” vehicles, he said. Self-driving may be a “low disruptor” because autonomous features may appeal to consumers. “Shared” vehicles may be “high disruption” because they “can disrupt the ownership model” where individuals buy cars and trucks.
“Shared” refers to ridership services such as Uber and Lyft. “There’s no profitable business model yet,” he said.
Yet, for now, is the key word. But all of this reflects why mobility is now the industry’s catchphrase.