Whopping 1700+ Startups will Disrupt the Automotive Industry

Digital transformation will affect the entire automotive value chain reshaping the traditional automotive business model as we know it

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Over 1700 startups along with technology companies are expected to disrupt and transform the automotive industry, as we know it. Digital transformation will affect the entire automotive value chain, including design, production, distribution and retail, reshaping the traditional automotive business model. The component hardware-driven automotive industry is shifting its focus and investments on software and solutions with spending rising rapidly and reaching $82.01 billion in 2020.

This finding comes from Frost & Sullivan’s Digital Transformation of the Automotive Industry division. It explores business activities, process improvements, and the development of competencies and business models across five key pillars: connected supply chain; Industrial IoT(IIoT)/Industry 4.0; connected and autonomous cars; digital retailing; and mobility-as-a-service (MaaS).

Frost & Sullivan, the growth partnership company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that make or break today's market participants.

"New business model will consider data, connectivity and customer centricity along with cybersecurity," said Frost & Sullivan Mobility senior consultant, Sriram Venkatraman. "By 2020, Chief Digital Officers will steer the strategic and digital initiatives of OEMs across luxury and economy brands."

Some interesting upcoming market developments include:

IT spend will increase from $37.95 billion in 2015 to reach $168.8 billion in 2025, exhibiting a compound annual growth rate of 16.1 percent

Investment will focus on electric vehicles, new mobility services, multi-modality, artificial intelligence, and autonomous vehicles

Security across both horizontal and vertical business layers will be enhanced as businesses integrate IoT and big data analytics

Country-specific, digital retailing strategy for new/used cars in addition to aftermarket and servicing will emerge

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