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AUTOMOTIVE

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by EOS Intelligence EOS Intelligence No Comments

Sino-US Trade War to Cause Ripple Effect of Implications in Auto Industry

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The whole world has its eyes on China and the USA as both nations are threatening to impose massive tariffs on each other in a ‘tit for tat’ trade skirmish. According to the Trump administration, the proposed tariffs are intended to punish China for pursuing its protectionist policies, currency manipulations, and alleged intellectual property (IP) theft. Fears of a possible full-scale trade war between the world’s two largest economies have caused global stock exchanges to plunge and cautioned investors as well as governments across the globe. There is no doubt that a trade war would not only hurt both economies, but it would also impact the overall global economy. As the proposed tariffs would pertain, amongst others, to vehicles and auto components, we are taking a look at potential implications this trade war might have on automotive industry in both countries.

Since his presidential campaign, president Trump has criticized China for pursuing protectionist policies, currency manipulations, and IP theft. In order to punish China for its current trade policies, and to reduce USA’s huge trade deficit with China, Trump proposed tariffs on approximately US$50 billion worth of Chinese goods coming into the country. Of these, approximately US$34 billion worth of Chinese goods including vehicles and auto parts will be subject to new tariffs starting from July 6, 2018, while the remaining US$16 billion are still under review.

The total automotive trade between the USA and China stood at US$33.9 billion in 2017. At present, in the USA, a 2.5% import tax is levied on imported vehicles and components. The current government proposes to raise this to 25% for vehicles and parts coming from China. China charges around 25% tax on vehicle imports from overseas, and now have threatened to add an additional 25% for vehicles built in the USA. Although these are just proposals for now, if they do get implemented, they will have implications on the entire automotive ecosystem in both countries, including carmakers, dealers, and auto parts manufacturers, and suppliers.

American companies won’t remain unaffected

A trade war with China will make domestic-made cars more expensive at home and less competitive in China. As a significant portion of the auto components and parts used by the US carmakers is sourced from China, increased tariffs will lead to increased production costs. Experts fear that OEMs will pass the increased costs onto the consumer. As a result, domestic auto sales are expected to witness a dip. Further, automakers based in the USA will become less competitive in China and may not be able to retain their current market share any longer.

Tesla is one of the companies that will feel the heat of higher tariffs. Chinese market accounted for approximately 17% of Tesla’s revenue in 2017. The company is already struggling to cope with the existing 25% import duties amid stiff competition from local rivals, such as BYD, NIO, and Byton, who have cheaper alternatives. American OEMs, such as Ford, GM, etc., fear that vehicles made by their subsidiaries in China and exported to the USA could end up being hit by the proposed tariffs.

Besides USA, German automakers such as BMW and Daimler will also be highly exposed since they are the largest vehicle exporters from the USA to China. Potential implications of the Sino-US trade war on companies mentioned above could lead to several job losses at US manufacturing plants. According to a report by Peterson Institute for International Economics, the trade war could result in loss of around 195,000 jobs over the next three years. Additionally, it will also impact other industry players such as auto component OEMs and suppliers, dealers, as well as local retailers.

Trade war could also hamper and limit US companies’ access to the Chinese automotive market, which is currently the largest market globally both in terms of production as well as sales. China is also the best-performing market in the world for electric vehicles (EVs) from sales, infrastructure, and government support perspective. With trade war in place, US companies could lose out to EU and other Asian counterparts on various market opportunities in China.

With trade war in place, US companies could lose out to EU and other Asian counterparts on various market opportunities in China.

Besides automakers, trade war will also have serious implications on auto parts manufacturers and suppliers as well. For example key tier-1 suppliers such as Lear, Delphi Automotive, Adient etc., rely heavily on China for their revenue. On the other side, there are many suppliers that rely on China for sourcing. China is also the largest trading partner for USA in tires. Exports in 2017 reached nearly US$2 billion, an increase of 28.2% as compared to previous year. If the proposed tariffs become reality, all these players will face business challenges on sales as well as supply-chain fronts.

Chinese companies will also face some implications

For the Chinese automotive industry, the trade war will impact mainly imported cars produced in the USA and domestic cars that use components from the USA. Since most cars sold in China are manufactured locally, the impact on Chinese auto OEMs will not be as significant as felt by their US counterparts. However, China is a major exporter of auto spare parts and components to the USA. In 2017, China exported auto parts worth US$17.4 billion to the USA. Thus, the trade war will heavily impact Chinese car parts manufacturers and exporters that rely on US business. On the EV front, new tariffs will raise the prices for parts and components imported from the USA. This in turn, will dampen the adoption of EVs due to higher initial costs and impact domestic EV sales.

Trade war is likely to hinder auto investments in China up to some extent as many companies might re-think their production and supply-chain strategies and put China investments on hold. For example, Ford has kept its plan to export Focus compact to the USA from China on hold due to the ongoing rift. Trade war will therefore impact local production as automakers serving USA market might scale down production in China. This might result in layoffs at local manufacturing units. In addition, trade skirmish with the USA will also create more obstacles for Chinese companies, such as Geely and GAC Motor, looking for market expansion in the USA.

Trade war will therefore impact local production as automakers serving USA market might scale down production in China.

 

EOS Perspective

In May 2018, president Xi announced to lower tariffs on imported cars to 15% effective from July 1, and ease ownership restrictions in automotive joint-ventures. This had somewhat cooled down the ongoing tension between the two nations. At this stage, many experts believed that the current situation will be resolved between the two nations via negotiations. However, despite three rounds of negotiations, both sides have failed to reach an agreement yet.

In the recent chain of events, Trump has threatened to slap extra tariffs on additional Chinese products worth US$400 billion. He also plans to restrict Chinese investments in American technology companies and technology exports from USA to China. This has opened up another front in the ongoing battle. In response, Beijing has warned to retaliate with levies on additional list of American products.

As of now, the potential effects of a full-blown trade war on the auto industry are not clear as they are still proposals. However, if tariffs were imposed, OEMs based in the USA would feel the strongest impact as they export around 280,000 vehicles to China each year.

In addition, considering that automakers today are more globalized than ever and depend on globally-integrated supply-chain networks to optimize their bottom line, a broader impact of the trade war would impact the supply-chains of many global OEMs. The business losses suffered by them will eventually pour down to auto parts suppliers, dealers, retailers, and local auto businesses, who will all feel the heat with varying degrees. It will be interesting to see how things progress and finalize over the next few days. For now, industry stakeholders are sweating over the looming trade war between the two powerhouses.

by EOS Intelligence EOS Intelligence No Comments

Africa’s Struggling Auto Market Set for Modest Recovery in 2018

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After a challenging 2016, most African economies experienced modest recovery in 2017, aided by a recovery of oil and commodity prices. The 2016 economic downturn and a decline in oil prices in Africa impacted some of the largest economies in both Sub-Saharan Africa and North Africa, including Algeria, Angola, Nigeria and South Africa. A recovery in oil prices to US$65-70 per barrel, from as low as US$30 in 2016-2017, has resulted in these economies rebounding after a period of low economic growth, and recession in the case of Nigeria. The World Bank expects economic recovery to continue over the next couple of years, and predicts African GDP to grow by 3.2% and 3.8% in 2018 and 2019, respectively. While economic conditions continue to ease, a negative sentiment has set in the African consumer markets, which has changed the outlook of the automotive industry significantly across the continent.

The article was published as part of Automotive World’s Special report on Africa.
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by EOS Intelligence EOS Intelligence No Comments

Commentary: Indian Automotive Sector – Reeling under the Budget

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The Indian automotive industry has been witnessing a period of recovery and growth over the past couple of years. Every year, automakers look towards the government to provide a stimulus in the form of favorable policies and budget allocations, to spur growth in the sector. A week has passed since the announcement of Indian budget for FY 2018-2019. We take a look at its short and long-term impact across the automotive value chain.

Supply-side scenario (component manufacturers and OEMs)

The current Indian government under Prime Minister Modi has been focusing on promoting domestic production of automobiles and auto components, as a part of its “Make in India” campaign. A 5% increase in customs duty on imported completely knocked down (CKD) cars and automotive components for assembly and sale in India is seen as another step in this direction.

While international OEMs such as Volkswagen and Skoda have been left reeling under the burden of additional costs, this provides an opportunity to spur growth particularly in the domestic components manufacturing.

Another positive news for domestic automotive components manufacturers, most of which are small and medium scale enterprises, is the reduction in corporate tax rate by 5% percentage points (for companies with a turnover of under INR 250 Crores / USD 38.83 million). These tax savings can provide companies with additional capital to invest in their business, aiding their long-term growth.

Investments in road and rural electrification infrastructure also encourage OEMs to bring new products, particularly electric vehicle (EV) portfolio, to the Indian market. However, lack of an established EV infrastructure means that this market development is likely to occur only over a long-term horizon.

Demand-side scenario (individual and corporate consumers)

The key factor impacting the demand for automobiles is perhaps how deep the consumers’ pockets are (or can be) after bearing all the tax burdens – in other words, how high the disposable income is in India. This is even more relevant for the lower-end of the market (or the so-called “mass spectrum”).

Minimal income tax incentives to individuals, coupled with rising inflation, are likely to limit the disposable income of most people (particularly in the low and medium income brackets), which form the largest consumer base for automobiles in terms of volume.

A booming stock market in India attracted several consumers in the middle income group to invest their capital in equities. Levy of a 10% long-term capital gain tax (LCGT) on returns from these equities (although grandfathered till INR 1 Lakh / USD1,553) is likely to put even further pressure on consumers’ pockets, especially for those looking to finance their automobile purchases by getting the most out of their investments.

Moreover, the knee-jerk reaction to this year’s budget was also observed on the equity market. The negative sentiment has led India’s two leading stock exchanges – BSE and NIFTY – witnessing a 5% decline within a 7 day period from the announcement of the budget, thereby eroding consumer’s wealth, which may further impact consumers’ short-term decisions to purchase vehicles.

On the other hand, the support provided to the agricultural sector is likely to spur demand for tractors and small passenger vehicles in rural areas, however this demand growth is dependent on the agricultural output, and derived from it incomes, in the coming year.

Aftermarket scenario (recyclers)

For the past couple of years, automotive companies as well as aftermarket recyclers have been expecting the government to bring in the scrapping policy, which would allow consumers as well as OEMs to benefit from voluntary replacement and scrapping of vehicles older than 15 years. However, lack of any announcements related to this policy has left the aftermarket recyclers and OEMs disappointed. They will need to wait to tap the demand expected to come from voluntary replacement of old vehicles in exchange of monetary benefits.

EOS Perspective

The scenario for electric vehicles (EVs) looks bright over a long term with significant investments going into development of rural electrification infrastructure, which will impact the development of the EV ecosystem beyond the metros as well. OEMs look at this as an opportunity, and this is evident from the number of EVs and electric concept cars to be unveiled at the Auto Expo 2018, India’s largest automotive exhibition. However, in a short to medium term, the adoption of EVs is likely to be limited to the corporate sector. General mass adoption is likely to lag behind due to vehicles’ high prices, and limited distance range/capacities offered by the current EVs available in the market.

As the mass automobile demand is expected to remain lull in the short term, the market will be driven by luxury and premium segments, which is largely unaffected by the budgetary challenges. A push is evident from OEM-side as well, with a number of premium, high-end products (such as SUVs, large displacement motorcycles, and luxury vehicles) launched at the Auto Expo 2018.

While the budget has left a lot to be desired, there are positives which bode well over the long term. The market is likely to witness a downturn in demand over a short term, as the consumers are likely to turn to preservation of wealth till the negative market sentiment prevails. Moreover, as the government invests in infrastructure projects, demand for both commercial and private vehicles is likely to pick up in the future.

It remains to be seen how soon the market witnesses a recovery in terms of automobile demand. One thing is certain, as always, when the budget comes next year, expectations will be high, partially fed by this year’s disappointments.

by EOS Intelligence EOS Intelligence No Comments

Turbocharging Trumps Supercharging in the Battle for Engine Downsizing

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Naturally aspirated engines have dominated the automotive landscape for decades. However, growing emphasis on the need to improve air quality in recent years has placed significant pressure on global vehicle manufacturers to improve fuel efficiency and ultimately reduce CO2 emissions. Not only have OEMs been subject to growing pressure from consumer groups and environmental activists, but there has also been a stronger push by…

The article was published as part of Automotive World’s Special report: Turbocharging and supercharging.

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by EOS Intelligence EOS Intelligence No Comments

China EV Policies: Is It A Bumpy Road Ahead for EV Players?

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Over the past several years, the Chinese government has been taking steps towards promoting green energy projects and building eco-friendly New Energy Vehicles (NEVs). Since 2008-2009, investments in green sector projects in China have witnessed tremendous growth, which is pushing development of the Chinese NEV industry. As China is slowly shifting focus from fossil fuel vehicles to electric vehicles, its involvement in developing technologies such as green energy and NEVs has equipped the country to compete at global level with western giants such as the USA, Germany, France, etc. While currently China is the largest producer of NEVs globally, it is still debatable whether in the future it will be able to sustain this growth to stay competitive and lead the global EV industry.

China has always aimed to become one of the global leaders in automobile industry similarly to its neighbors, Japan and South Korea, but for the longest time it was not able to produce vehicles that would be globally competitive in terms of quality and safety. In 2009, the Beijing government introduced Automotive Industry Readjustment and Revitalization Plan to strengthen China’s position in the global automotive market. The key objectives of the plan were to support domestic auto manufacturers, commercially as well as technologically, and allocate more resources to environmental friendly vehicles’ research and promotion. The government started promoting electric cars to tackle the environmental threats that China was facing. Electric and hybrid cars were relatively new concepts in 2009-2010, but this did not dissuade China and it started building strategies to increase production of such vehicles to compete and lead in the NEV market.

Since 2010, the Chinese government has been providing incentives, in various forms, for the NEV sector. For instance, the government introduced direct subsidies for NEV manufacturers, deductions for local authorities opting for green cars, and tax waivers and free registration incentives for consumers purchasing electric cars. These incentives accelerated the growth of NEV industry, which sold around 507,000 units in 2016 as compared with 480 units in 2009. Currently, the top ten global EV manufacturers are all Chinese producers. China aims to sell around two million electric cars annually and introduce a fleet of five million electric cars on the country’s roads by 2020. China’s goal, in terms of NEV sales, is quite ambitious but also necessary, as the country aims to limit its carbon emission rate by 2030 and curtail air pollution.

With the Chinese government shifting its focus on promoting green energy and green vehicles, changes have been made in various policies laid down for the auto sector. For instance, the 13th Five Year Plan, introduced in 2016, promotes adoption of NEVs. Government is also considering to ban gasoline and diesel vehicles, indicating that in near future, automakers may have to redesign their production and shift to green vehicle manufacturing.

In June 2017, the Chinese government made it compulsory for automakers selling more than or equal to 30,000 cars annually to increase share of EVs in their total auto sales. China’s Ministry of Industry and Information Technology (MIIT) introduced the carbon credit trading program, which mandates manufacturers to earn carbon credit score on their automobile production and sales. The policy is aimed to encourage production of various types of zero and low-emission vehicles. Effective 2019, manufacturers will be required to earn EV credits equivalent to 10% of sales, which would eventually rise to 12% in 2020. The credit score will be calculated on the basis of electrification level of the cars produced, indicating that fully electric cars will earn more credits than plug-in hybrid cars. Manufacturers not complying with these quotas will either have to buy credits or pay penalties. A credit score equivalent to 12% of sales will be equal to about 4-5% of EV sales, which could lead to the production of more than a million green energy vehicles in China in 2020. Certainly, this policy will be beneficial to the domestic EV manufacturers, who have massive EV production, as their income from credit sales will increase.

In January 2017, the Chinese government introduced another change in EV policy to subsequently phase out the tax benefits on purchase of EVs by 2021. The announcement has resulted in slight decline in consumer demand for EVs in China.

Further, the government has mandated the foreign players to form a 50-50 joint venture (JV) with domestic firms to operate in China. Consequently, the foreign players are forced to share their intellectual property and technology with local Chinese automakers. Some of the countries perceive this move as intellectual property theft by China. In the future, the Chinese government is likely to relax the JV terms and increase the foreign player’s percentage share in a JV.

China's Emergence in EV Market

 

EOS Perspective

Currently, China holds a bright spot in the global electric vehicle industry. Fuel-run vehicles are expected to lose their dominant position in a couple of decades if the EV industry continues to grow at the anticipated rates. Being the largest market for NEVs globally, China is likely to play a major role in this progress. But to continue leading the EV market, foremost requisite is to solve issues such as the price to performance ratio of batteries, and lack of sufficient charging stations and EV infrastructure in China.

In near-term, undoubtedly, China will remain a huge market for NEVs with foreign players aiming to be a part of it. It is yet to be seen what changes the Chinese government makes in JV terms for foreign players, but they will surely face a stiff competition from the well-settled domestic EV manufacturers. Selling in the competitive environment of China will surely affect their profits, but the main concern for them will be sharing their intellectual property with Chinese OEMs. Another challenge for all players would be to understand whether consumer demand for EVs will continue to thrive after the price increase related to the gradual withdrawal of subsidies and tax benefits. China has strategically kept NEV prices low to increase popularity and awareness of EVs amongst consumers. However, the government does not plan to sustain the low-priced regime, with the recent policy changes and subsidy phase outs likely to gradually increase EV prices in China, which might impact demand for EVs (it is likely to still remain high as compared with demand in other countries). The government plans to focus more on research and innovation to supply EVs at lower prices without any subsidies as well as to build robust infrastructure to support growth of the industry.

China also plans to export EVs to other major markets such as the USA, Norway, the UK, Germany, and Korea. With the current low quality and performance of domestically manufactured EVs, local Chinese players are not getting many buyers in these countries. But forging JVs with foreign players to produce EVs at lower rates and better quality may improve the export figures in future.

China has definitely raised the bar for other countries with its aggressive EV policies launched in 2017, which are future-centric and focused on ushering in a revolution in the auto industry by promoting EV vehicles over the traditional diesel/gasoline-based vehicles. In the future, NEV manufacturers in China are likely to focus on building economical and efficient vehicles, and with foreign players bringing in their latest EV manufacturing technologies, the future drive looks smooth for Chinese NEVs.

by EOS Intelligence EOS Intelligence No Comments

Electric Trucks in Japan – a Tale of Tests and Trials

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“I am convinced that electric trucks are the future of inner-city distribution”, said Marc Llistosella, President and Chief Executive of Mitsubishi Fuso Truck and Bus Corporation (MFTBC) when inaugurating Japan’s first public power charging station for trucks in May 2017.

There are two ways to view Llistosella’s statement. On the one hand, with the launch of the Fuso eCanter, a fully electric light truck, in 2017 and now with the setting up of the charging infrastructure, Mitsubishi is establishing a strong hold in Japan’s electric/electrified trucking space, marking its territory as one of the few players in the country to go beyond the trial phase.

 

The article was published as part of Automotive World’s Special report: ACE trucks – autonomous, connected, electrified.

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by EOS Intelligence EOS Intelligence No Comments

Breaking Bad, Building New: Customer Engagement Model for Automakers

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Digital transformation buzz has revolutionized the way companies operate and interact with their customers across virtually all industries. Automotive industry is no exception. Customer expectations today are more demanding than ever, primarily due to the service level benchmarks set up by the likes of Amazon, Uber, and Apple, as well as due to plethora of information customers can get through the internet and social media. The rise of digital channels is fundamentally transforming the entire auto retailing business. In order to stay ahead of the game, automakers will have to break their legacy systems and build new customer-centric marketing models.

The automotive industry has always been characterized by an extremely time consuming as well as complex sales processes that often result in an unpleasant customer experience. The industry notion “People love shopping for cars; they hate buying cars” precisely depicts the challenge auto retailers have to deal with and the need for industry players to rethink their sales and marketing models to enhance the overall customer experience. The Apple and Amazon retail ethos of seamless customer interaction, simple and streamlined sales processes, effortless and speedy customer services has become the benchmark for all retailers. Even in the automotive industry, changing customer preferences, digital transformation, increased connectivity are reshaping the entire retail supply chain, with major impact on the final parts of the chain involving direct customer interaction. The rise of cutting edge technologies, tech and information savvy consumers, and new market entrants are forcing traditional players to rethink and reinvent their entire business models.

The advent of technology has significantly lowered entry barriers for new entrants in the automotive retail segment, who have brought innovative business models and fresh ideas to help customers find, evaluate, and buy new vehicles. With slogans such as “Skip the dealership” and “Find deals. Not dealers!” new players such as Roadster or Rockar are transforming automotive retailing by offering a bargain-free and smooth car buying experience that can allow the customer to purchase a car and have it delivered to their doorstep within few hours. Traditional retailers have started to realize that, equipped with massive information at their fingertips, car buyers today are better informed than ever when it comes to car purchasing. One bad experience and customers will be very reluctant to ever come back to the same retailer. Despite this realization, many companies are still ‘moving metal’ the old-fashioned way using traditional media and other marketing approaches to attract consumers to their stores.

Statistics from many industry studies make it clear that with the mass proliferation of technologies, car buying journey is becoming increasingly digital, with most customers spending a significant part of their buying time online. Studies indicate that more than 65% of the information-gathering and decision-making process is already made prior to visiting a dealership. Therefore, it becomes vital for OEMs and dealers to rethink their entire marketing and customer engagement approach. They need to interact more effectively and engage consumers early and throughout their purchase journey.

OEMs and dealers need to understand that the whole process of buying cars is quite different from the process in some other retail segments. For example, to buy consumer electronics, many consumers visit the store to see/touch/feel the product and then buy it online because of the price benefits and other offers. In case of buying cars, most customers do their research and comparison online. They visit the local dealership to see/touch/feel the car and buy it there to benefit from special discounts and offers. Hence, it is very crucial to have an integrated and seamless transition across various channels in a frictionless manner.

The introduction of new business models (direct-to-customer) and customer experience strategies (highly interactive and pressure-free brand stores) created by the likes of Tesla, or Rockar, have caught the eyes of many traditional players, who have gauged the significance of realigning their marketing and customer engagement strategies as per demands of the rapidly evolving industry. Many OEMs and dealers have started to take a hard look at their entire customer lifecycle processes to assess the current gaps and address them. Companies are reconfiguring their touch points across channels by eliminating redundant processes and services. Recently, automakers such as BMW, Audi, and Mercedes have rolled out brand stores similar to Apple’s, where customers can visualize their cars, configure them to their own specifications, get experts to answer their questions, and even buy cars in a non-pressurized sales environment. Having already seen some positive results, these OEMs are likely to ramp up their efforts to roll out such brand stores on a larger scale across cities, states, as well as countries in the near future. While not all automakers have plans to launch such stores at present, it is expected that it will not be long before OEMs with no such current plans observe and eventually follow the footsteps of OEM players that have already reaped these rewards and showed what advantages such stores can offer.

EOS Perspective

As digital transformation continues to revolutionize the auto retailing landscape, there is no doubt that advancing technologies will make the car buying process increasingly digital for the years to come. We can expect a rapid surge of various online platforms that provide customers with the ability to easily research, evaluate, and buy cars. Operating within such a highly competitive marketplace with changing customer preferences, auto retailers will have to transform their business models to become more customer-centric and deliver on customers’ expectations. They will have to reinvent customer engagement frameworks to create ones that are built around customer needs, and are simple, frictionless, more transparent, quicker, and convenient for today’s savvy car buyers. On the one hand, this will help OEMs and dealers win more business, while on the other hand customers will benefit from an accelerated and hassle-free sales process, resulting in an improved customer experience.

Although transforming current customer engagement model seems inevitable, this will not come easy and will involve massive changes in existing marketing models. At present, majority of industry players lack the resources, infrastructure, and systems required to execute this transformation. In addition, as signification investments will be required, amid current business environment with high cost and competitive pressure, many automakers as well as dealers will still continue to engage in sales the old fashioned way or adopt a ‘wait-and-watch’ stance. At a dealer level, implementation of new customer engagement model will be much slower primarily due to capabilities and resources constraints.

In the end, one thing is obvious – in order to retain today’s customers and to win new ones, OEMs and dealers will have to reinvent their marketing and customer engagement strategies. To achieve this transformation, these players will have to work together to deliver rich brand experience and match the simplified and streamlined buying experiences set by Amazon and others. OEMs and dealers should take John F. Kennedy’s words to heart “Change is the law of life. And those who look only to the past, or the present, are certain to miss the future.”

by EOS Intelligence EOS Intelligence No Comments

India – Prime Target for Smart Mobility

India’s rapidly growing urban population (CAGR 2.35% between 2011 and 2031e), increasing motorization rate (CAGR 12.7% between 2010 and 2025e), critical level of traffic congestion, growing rate of accidents, inadequate mobility monitoring and deteriorating air quality make the country a prime target for smart mobility solutions.

Mobility-as-a-Service (MaaS) could be a game changer for India’s traffic and transportation woes by seamlessly integrating the first and last mile connectivity to supplement the existing fragmented transportation systems. MaaS has the potential to help bridge the current gap between rapid mobility demand and the slow pace of infrastructure development. The rapid consumerization of IT and technology and growing smartphone penetration should help boost the adoption of MaaS, as long as the country’s government stands by its words of making India ‘truly digital’.

We take a closer look at MaaS and the potential impact it might have on India’s transportation and travel – two areas that could be radically altered.

To read further, go to Automotive World’s Q2 2017 Megatrends Magazine.

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