The 4 Ways of CASE and Disintermediation the Automotive Landscape

1 BrjY-vWtfOqUZgUj56-e2A@2xThe introduction of CASE (Connected, Autonomous, Shared, Electrified) technologies has created a new set of choices for automotive companies. Each company — regardless of their origins as Silicon Valley start-up or Detroit iconic stalwart — needs to determine which set of capabilities it will need to be successful in its quest to get closer to the customer. And with customer sentiments moving from owning vehicles to consuming vehicles based on subscription models (allowing greater choice of vehicle, time and use options), automotive companies are putting bets on where to play, with whom to partner and how to go about doing so.

In our work with companies at SAP, I find that a number of roles are emerging to consider what business model — and resulting capabilities would be needed — to win in the new automotive world. While many companies (particularly start-ups) have predefined growth and exit strategies, many companies are still trying to forge ahead in the brave new world. Some have figured out their initial direction and some are still working on it with the help of partners. In one recent meeting I was asked what did we do in the connected vehicle space. My answer at the end of the day is a flip question: what does an automotive company want to do in terms of brand, operating companies, partnerships and technologies to get closer to the new automotive customer?

From my perch I see four ways CASE is already leading to the disintermediation of the automotive industry. It’s a heady time and companies are trying to understand where they fall into the new roles and strategies based on past and future roles that automotive companies can — and should — play.

  1. Traditional Auto Maker. These are the traditional brands that build cars, for both traditional personal consumer use as well as enabled with CASE technologies which may look (and drive) a lot differently. In this case an automaker may elect to build cars for a Fleet Operator, as in the case of Fiat-Chrysler who builds a lot of Pacifica minivans for the Google Waymo fleet of robtaxis. In this model, traditional OEM capabilities continue to be important, with focus on revenue, margin and Operational Excellence. Captive finance options — the ability to up-sell and out-sell to customers within the brand ecosystem — is very important.
  2. Platform Maker. These may be new start-up and growth companies like Zoox or traditional companies like Honda that are creating new platforms or are designing products around very well defined CASE components (such as BEV and other electrified propulsion and power systems). Platform makers may or may not opt to actually build cars. Interior design and instrumentation company IDEO is a good example, defining the elements which are distinct in a platform and working with traditional automakers like Ford to express and build the platform. When and if Platform Makers do commit to actually build a vehicle, there can be a steep learning curve (as in the case of Tesla, which literally had to learn to build vehicles at scale after designing and building successful low volume platforms). Low cost, start-up mentality, often pre-revenue or early revenue often drives behavior and capabilities needs. This can also include high touch, 1:1 configurations for Fleet Operators as well as personal vehicle owners (a good example of this is uber-lux maker Karma Automotive).
  3. Fleet Operators. While this may sound not as bourgeois as the makers, Fleet Operators are closest to the customer which makes them the kings of the ecosystem. Fleet Operators can certainly be brands within automakers (GM Maven is a great example) or customers / partners of Platform Makers (Google Waymo has already racked up millions of vehicle miles traveled — VMT — as part of their robotaxi fleet). Fleet Operators can offer subscription access to a variety of make and model vehicles in an automaker’s line-up or look more traditional like the next generation rental car company (think ZipCar). Asset management, high vehicle use maintenance (up to 90% over time), predictive fleet MRO are all major operating concerns. Fleet Operators also have a unique advantage to be able to harvest and manage both vehicle use data as well as customer use data while using fleet assets (as privacy allows). This means that Fleet Operators are also well positioned to be Information Brokers.
  4. Information Brokers. While the expression might conjure images of rows of data servers in a large raised-floor room humming under dimming lights, one thing is certain: data is the new oil. Information Brokers (as privacy allows, don’t forget GDPR) can monetize vehicle use and occupant information for many lateral industries such as finance and insurance, transportation and logistics, smart city grids and vehicle to infrastructure (V2I) applications, and many other personal customer experience (CX) applications. Information Brokers are very focused on big data operations (think Petabytes weekly per origin of data), data analytics, and product creation based on intended audience(s). Tuck-in opportunities for third party data sources to round out and enhance data already collected offer many commercial possibilities, as in the case of insurance companies tracking operator behavior and vehicle use.

There is of course the big wild card in all of this — what is the next business model that has not been created that we can’t forecast. The many kinds and fashions of roles automotive companies will take on as CASE technologies mature over the next 20 years are simply unimaginable. However, based on where we sit heading into 2019, automotive companies will choose one or more of the business models available today and craft their strategies to be successful in in the market tomorrow.

This blog was originally published in Medium and LinkedIn.


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Aftermarket 4.0: From Digital Process to Digital Products

AASA AIM Keynote 2019

Inaugural keynote for the Aftermarket Innovation Mobility council (source: AASA)

In early October, the Third Annual Digital Aftermarket Study was released by SAP and the Automotive Aftermarket Supplier Association (AASA).  The key findings were presented at the AASA Technology Conference with a focus on digital process improvements in the areas of customer centricity, supply chain planning and inventory management.  In addition to examining the digitization of process in the automotive aftermarket segment, this year’s study also examined for the first time the digitization of aftermarket products, or what industry watchers have referred to as the “shift from hard parts to smart parts.” We are calling this shift Aftermarket 4.0 consistent with the general trends across the industry and its sectors, including light passenger vehicle, heavy and commercial vehicle and through the supply base.

To emphasis this shift, an inaugural meeting of the Aftermarket Mobility council with general interest of the supply base participating in this space was held, and SAP was asked to participate in the keynote for this event.  Why does this matter to SAP?  The Aftermarket 4.0 space aligns to the following key pillars of automotive strategy for SAP and its clients:

  1. Customer centricity means the shift from personally owned vehicles to those enabled through CASE (Connected Autonomous Shared Electrified) technologies and operated in fleets. Forecasts for personally owned vehicle sales from IHS Markit, Frost & Sullivan, and McKinsey views traditional vehicle growth rates of +2-4% until 2030. Yet overall vehicle use will explode. Digitizing aftermarket for high usage fleets represents a +$500 Billion opportunity for aftermarket (McKinsey, 2016 – based on current vehicle forecast models)
  2. Digital Smart Products – enabling these CASE technologies – will force the shift from hard parts to smart parts. This year’s aftermarket study illustrated that over 70% of AASA members have begun to plan for products leveraging CASE technologies and 60% of members intend to reflect those in their business demand models in the next five years with 40% already reflecting this change today.
  3. Digitizing the Supply Chain remains a very hot process for aftermarket with significant improvement potential in both inventory and logistics. The ability to manage forecasts, inventory levels, and service levels consistently on an “when needed, where needed” basis. Particularly at the distribution center and warehouse level of the segment, this time criticality remains essential.
  4. The Changing Workforce will shift how we do our business from diagnostics to part tracking to basic work place organization. It will also impact the driver interest in using the products with more do it for you (DIFY) fleet service versus do it yourself (DIY) as more and more vehicle users drive less and less for pleasure.
  5. New Business Models will impact every aspect of the aftermarket business. Digital services to and from the vehicle will represent a $1.2 trillion opportunity by 2030 according to McKinsey (2016). SAP engaged 18 months ago with Mojio – an application and services delivery platform which leverages vehicle use data. This in combination with other digital platform software makers elevated SAP to status as a tier-2 automotive software product supplier. As such, the shift to Aftermarket 4.0 will happen whether we plan for it or not, with the winners being the companies that actively plan for the shift in the next five years.

To listen to a full play-by-play of the Aftermarket 4.0 shift, AASA Vice President Chris Gardner and I joined host Bonnie D. Graham in a post-event SAP Radio program.  You can listen to the show here and join the conversation in the comments section.

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Automotive Industry Gathers Under Clouds of Uncertainty, yet Optimistic about the Future

Last week’s passing of automotive legend Sergio Marchionne, former CEO of Fiat Chrysler, illustrated how quickly the shifts of automotive futures can truly be. Less than a week on the job, his successor – British American Mike Manley, head of the successful Dodge and Jeep brands – led the company earnings call which was more a somber wake than a call to action for the company five-year plan. Analysts mourned and tributes poured in. It was a surreal moment that touched many in the industry.


While FCA dealt with their own succession issues, GM and Ford also provided earnings calls that – while strong in terms of sales forecasts – left a lot of uncertainty on the table in the face of margin resistance stemming from the US administration move on EU and China aluminum and steel import tariffs.

It is under these clouds of uncertainty – which manifested Sunday in physical form, canceling an always popular golf outing – which the industry convenes for the annual Center for Automotive Research (CAR) Management Briefing Seminars in Traverse City, Michigan this week.

The three things that attendees should be focused on as the industry continues to transition to new business models in preparation for the industry shift to connected and autonomous vehicles range from tactical to strategic to regulatory. Going from back to front:

  1. EPA and Tariffs provide uncertainty. Look for clues from speakers about the shift in EPA regulatory standards (big announcement seems to always be a week away) which could roll back some Obama era requirements for overall brand fleet fuel efficiency levels. As noted earlier the dynamic positing on steel and aluminum tariffs make for active discussion particularly now that two American based automotive stalwarts have shot cautionary earnings messages over Washington and the markets.
  2. New business models taking hold. While each automaker will arrive at their own business model for their operations moving forward, a common response emerging. Last week, Daimler and Ford joined GM, Toyota and other OEMs in declaring a three-pronged business model. In this business model, companies wil move to create new entities and/or operations to govern connected vehicles, mid-size to heavy commercial vehicles, as well as the traditional model of light passenger vehicles built for personal consumer use. Each segment demands certain key requirements in support of these different business models. It will be interesting to hear industry leaders address their businesses in these terms.
  3. Talent management and succession planning. While the automotive industry continues in its quest to attract and retain highly skilled talent, the passing of Mr. Marchionne conveys a renewed importance in active and current transition planning. While executive transition planning is common, going deeper into the organization to work through the parabolic combinations of how an organization – with deaths, retirements and new business models – will function is now more important than ever. Watch to see if more comment is made on this topic by industry leaders.
  • What do you think will be the big topics discussed this week? Leave a comment on this post. As always follow our blog and event news #CARMBS.
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    Automotive Supply Chain Leaders: Winning In Supply Chain During A Time Of Industry Disruption



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    Digitizing the Automotive Aftermarket: Who’s Cashing In?


    This week I was able to join host Bonnie D. Graham and guest Chris Gardner, Vice President of Member Services with the Automotive Aftermarket Supplier Association (AASA) to talk connected cars, digitization and the impact on the NA aftermarket supplier segment.  You can listen to the full 2-part program on the Voice of America web radio station, selected highlights from the transcript are found below.


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    Automotive Supply Chain Leaders: Winning In Supply Chain During A Time Of Industry Disruption

    tractor-trailing-moving-down-a-highwayToday’s automotive business is vast and complex. Particularly for supply chain leaders, these industry complexities represent several challenges unique to the complexities of the automotive industry:

    • Visibility so that you have clarity across a multi-tier international supply chain, across multiple plants and DC locations.
    • Responsiveness so that your supply chain can adapt more quickly to small lot sizes and increase profitability.
    • Upstream decision-making based on data and insights across the supply chain to help decision making and sensitivity analysis
    • Managing collaborative supply networks for sales and operation planning (S&OP) comprehension and collaboration across business leaders

    While these are not necessarily new capabilities, the speed and accuracy of the necessary capabilities are unlike anything supply chain leaders have ever seen before. Supply chain leaders need to be able to deliver these capabilities in a timely and accurate manner.

    The move to digital impacts supply chain leaders

    But being a successful supply chain leader isn’t about simply delivering on operational excellence capabilities. To be a digital supply chain leader, executives also need to manage risk across a number of dimensions. There is a need to acquire the right skills and talent to create and manage a supply chain risk program. There is a need to provide the right level of agility and responsiveness in a timely and accurate manner.

    Supply chain teams need to collect, collaborate, and exchange information across multiple internal and external systems to manage performance and meet regulatory requirements. Supply chain leaders need to have the right level of exposure and importance to supply chain dynamics inside of the organization. Finally, supply chain leaders need to be able to securely and accurately deliver product traceability across all trading partners whether they be suppliers, brokers, carriers, customers. Many companies address these new capabilities in different ways, with varying success.

    digital-supply-chain-capabilities-1024x287.pngWhat is at stake?

    What is at stake is nothing short of business success. For an automotive business to be successful, it needs to consider many of the dynamic shifts occurring in the industry today. From consolidation and vertical integration to the changing dynamic of connected vehicles to the hyper-connected consumer landscape to the full integration of sales and operations, and planning…. Each step provides an opportunity to mitigate risk and reduce working capital leakage, but also affords many landmines in the way of doing so. The old spreadsheet-based legacy system way of operating a supply chain is simply no longer viable to you and your team.

    The need to be a digital supply chain leader creates an opportunity to re-evaluate all personal traits and learnings to create a culture of innovation inside the supply chain organization. From continual learning to greater speeds and agility, today’s supply chain leader can create and shape how the automotive company can compete and win in the industry. As James McQuivey from Forrester Research says, “The only way to compete is to evolve.”

    Nothing could be more true for today’s supply chain leaders.

    This article originally appeared in Digital!st Magazine and is reprinted here with permission by the author. For more on this topic, see Four Essential Technologies Powering The Digital Supply Chain.



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    Digital Disruption in Automotive

    As part of our work with the Future of Cars special edition of Coffee Break with Game-Changers, I sat down with host Bonnie D. Graham and gave my point of view on who were the disruptors and who were being disrupted at the recent Best Practices for Automotive (#BP4Auto) event September 18-20 in Detroit.  Listen to the full cast below, with transcript follows.  For more event reviews, listen to my series re-cap for 2017 live, Tuesday October 10, 2017 at 10AM ET / 7AM PT or on demand here.

    Bonnie: Welcome to SAP’s 3rd Annual Best Practices for Automotive Conference. We are bringing together hundreds of professionals in the automotive industry. They’re senior leaders, they’re decision-makers, analysts, super-users, support teams, solution providers, business process owners, we may even have some press and some students and educators there. Why? SAP is sponsoring and hosting a one-of-a-kind experiential event built around  three wonderful factors: learning, innovation, and peer collaboration. Does it get any better than this?

    Hello, I’m Bonnie D. Graham, the producer and host of The Future of Cars with Game-Changers radio, presented by SAP. And on the other side of the microphone is, I can say, my good friend, and he has been many times on our radio series. He is now taking over as the owner of the Editorial Calendar for the Future of Cars—It’s William, I’m allowed to call him Bill, Bill Newman, Strategic Industry Advisor, North American Automotive at SAP.

    Hi Bill, how are you today?

    Bill: I’m good, Bonnie. How are you doing this afternoon?

    Bonnie: I am well. I wish I was there with you in Detroit. I heard from David Parrish and Pradeep Amladi and everybody says it’s a great conference. I hear there’s some amazing cars here on the show floor. You want to tell me just for a second what you’ve seen before I get you my questions?

    Bill: Yeah, sure. I mean, it’s a great event. We’ve got close to 400 people and we’re all here in Detroit, the hub of the car industry here in North America. We’ve got, I think, over 20 countries represented.

    We’ve got a packed house full of great partners and vendors that are with us today, and we had a nice opening earlier today who is Stefan Krauss, who is our Global Head of our Automotive Industry here in Detroit. It’s just been really great to come together.

    We were actually walking through the lunch line and I bumped into an old colleague from Volkswagen and we were joking about how this is a bit of a homecoming. Everyone kind of moves around in automotive and really, nobody leaves. It’s a nice intimate environment given so many people so I think everybody’s really got a nice vibe going on today.

    Bonnie: That’s a really nice perspective, Bill. Thank you—I wasn’t planning to ask you that but I know that you’re a good on-your-feet talker, if you will. So I really appreciate that. I love the idea that it’s a homecoming of sorts and at the very end of the interview, in a few minutes, I’m going to ask you a question about why people who are listening to us but not there this year should be there next year. So maybe we can drop that word on them once again.

    Bill Newman, our listeners are from all overall the world. You know, you’ve been on Game-Changers with me many times. We have a global audience and they’re wondering, what does SAP see as the top trends and/or the top challenges facing the automotive industry today? What’s your POV? What do you see, Bill?

    Bill: I think in terms of a digital disruption, everybody’s trying to do it. There’s not an emerging standard or business model that all of the, let’s say, automakers and of course, their suppliers are moving, too. So they’re trying to understand, first of all, what is it that they’re trying to move to? We looked at autonomous shared electrified vehicles. What does that mean for a particular company and everybody’s trying to figure that out. And then as an aggregate, how is the industry going to move there?

    You and I spoke very recently on our Future of Cars with Game-Changers show and we were talking about some of the new federal regulations that are going to allow a certain number, I think a couple thousand a hundred thousand vehicles, level three, level four autonomous vehicles over the next five years operate on the road.

    Everybody’s trying to figure out, how do we digitize, so that’s operationally, and then how do we monetize? So if you look at some of the work that McKinsey and Roland-Burger and IHS, some of the other auto think tanks that have thought about—they’ve actually suggested that the big upside isn’t the car that you buy and we park it at our garage and it sits there for 70-80% of the time or more when we’re not using it but it’s really the digital services and the consumerization of the automotive is really another device.

    Everybody’s trying to figure out where they play in that space and that, according to McKenzie, is going to be a $1.5 trillion dollar marketplace by 2030. So that’s huge. And you’re seeing some of the companies begin to make moves to put their bets on that. Maybe it’s the case of GM pulling out of Europe and selling their operations to Peugeot, PSA, and you’ve got winding down some operations that weren’t really performing particularly well in India and making their bets on high growth, BRAC markets, or the new digital space.

    That’s just one example, but again, everybody’s trying to figure out what that means for them and arguably, if I can return to the GM example, that was a big thing. They have been working to become profitable in Europe for decades and finally, arguably achieved that to a point where they decided that they felt comfortable then, carving that out and putting those assets on other bets.

    So, you don’t need to be the largest revenue car-producing company, but we want to get a share of the higher margin automotive services, vehicle space, next generation vehicle. Obviously, that’s a big bet that takes a lot of capital investment, so each automaker is sorting that out right now. That’s a really big deal in the industry.

    Bonnie: Thank you, Bill. You answered my next question in advance. Let me just read the question. You covered it, but I have a part two to the question. I was going to ask you which of the top trends you’re seeing will spawn or spark, I should say, the most significant new business models in automotive? I think you just talked about that, so let me move to part two, which is, where is SAP in being able to be positioned to help companies realize the value, the benefit, the profitability of those models?

    Bill: Well, I’ll go back to part one and tell you where the biggest barrier is right now, which is a question you weren’t going to ask me, so let’s go there. That’s talent management.

    Bonnie: Really?

    Bill: Absolutely. We’ve got all of these—you keep hearing about it—if you’ve got kids or friends with kids in school and they’re talking about STEM (science, technology, engineering, and math), they’re just not enough of those graduates to go around.

    Now, SAP, in conjunction with many of their user groups, both in North America and throughout the world, have excellent qualification and certification programs ready. Graduates coming out of university and four-year colleges [are ready] to take on those positions, but they’re very competitive and other industries outside of automotive are vying for the same talent pool and resource.

    Even in engineering and manufacturing practices, we see the lack of talent in those practices actually equating to—and this is the Center of Automotive Research – so this isn’t just something we’re pulling out [of the air] – a 6% capacity gap. Meaning that the whole industry could be operating at a 6% higher volume level rate right now if we had the talent available to do all of the things that we wanted to do, to make cars and to move to digital. So, that’s a pretty big gap. So what’s SAP doing? Certainly, we’ve got a number of functional expertise areas across.

    So for example, to address talent management, to address procurement for digital leaders in finance and manufacturing, I think the exciting thing in automotive and in particular, is that we’re addressing three very specific needs in automotive.

    The big data, with our large HANA platform and memory platform that’s been in production. We’ve got thousands of consumers, whether it’s analytics or running ERP or moving to a new S/4 platform that are being able to take advantage of that.

    I think the second is business networks, so being able to monetize the purchasing power through our Ariba products, to look at time and expenses through Concur that tie back into finance. We’ve got these broad multi-million individual and company networks.

    The third area, which I think is the most exciting, is SAP vehicle networks where we are creating apps that actually go into the on-board services of vehicles that our customers are making. And in this way, we truly are an automotive supplier now.

    We are putting content and applications, whether it’s figuring out where you’re going to park next to where you can route and then bill your expense report or whether we can do some promotions or some consumer driven services, where you might go out to dinner.

    All of those things are being developed now with our great customers and partners and they’re being targeted for use in both the commercial and light passenger vehicle market space. Truly, we can stand up and we can make our claim that SAP is truly an automotive supplier in that sense. I think that’s really exciting.

    Bonnie: It’s very exciting. I wasn’t aware of that level of positioning, Bill. I’m still reeling over your comment that there’s a talent challenge, getting kids through the STEM programs and into the automotive industry to bring brilliance, not only in technical skills but probably in the way they think and the visionary qualities of how they approach—

    Bill: Indeed.

    Bonnie: Yeah, that’s where you cannot have a shortage, especially right now. You know what? This leads me—I think it’s a nice segue, Bill Newman, to my next question. Stefan Krauss, the opening keynote speaker at the conference today, asked the question of the audience, “Are you the disruptor or the disrupted?”

    This goes back, I think, to your comment about the talent pool. How do you disrupt if you don’t have a talent pool that is helping you become the disruptor? Meaning you’re not the victim, but you’re on the leading edge. So let me ask you a question, Bill—what do you see at the event in terms of companies—on what end of the spectrum?

    They might start out as disrupted and then move toward being the new disruptor and we know we’ve talked on Game-Changers radio that I’ve said, the industry is just layer upon layer of surprising disruptions. It just isn’t settling down anytime soon. Who’s attending? Are they disruptors? Disrupted? Or someone on that continuum?

    Bill: Yeah, we’ve been able to see a few of the early breakouts and they’re just excellent, talking about everybody’s journey, whether it’s in people or talent or manufacturing or supply chain, it’s just really exciting. That’s what I like most about this program, in conjunction with our [friends at] Eventful Conferences and ASUG, which is our North American SAP user group. It’s really for SAP customers by SAP customers.

    So you’re going to get a little of our teams and our positioning but really, it’s our stories that are coming from the field from colleagues—your own industry colleagues if you’re one of our customers, which I think is great. So I think we’re at a crossroads.

    I think there are a lot of people here trying to understand and learn, which is wonderful, about what people are doing. And then you’ve got some digital leaders like Karma Automotive and others who have gone pretty deep into their digital journey with us at SAP. Arguably, Karma—I used to work at Volkswagen when we owned Bentley and Rolls Royce. We used to joke it was a vitamin business. You only had to sell one or two cars a day and everything was fine.

    Arguably, Karma – the former Fisker Automotive – is a bit of that same uber-lux market. And they’ve literally invested talent—here we go, talent again—as well as capital assets into creating an uber-lux, not only buying experience for their customers, more of a concierge and thematic experience.

    For example, if you feel like you’re fall and you want to go hiking, Karma will be happy to orient the interior the car to that theme, if you will. So it’s really the uber-lux experience. But also to the operations of the manufacturing of their new plant in Southern California. That’s very exciting and of course, it’s still a driver-powered vehicle, but digitized and electrified type of product. That’s really exciting to see.

    And we do have some industry crossover, so Lockheed Martin spoke earlier this morning, giving a little bit of a story about what they see both from an aerospace as well as a contract vehicle manufacturing journey that they go through. Both very large and very small companies, and again, partners – we have such a fantastic partner ecosystem –  that are able to come in and play those specific roles to help our customers. It’s just really good to see. We’re going to see more over the next two days that we’re together.

    Bonnie: Very exciting. You mentioned the word ‘electrified’. I was going to say what you’re telling me, Bill Newman, is electrifying. It’s very exciting. You mean seriously, uber-lux? You’re talking about customizing the interior of a vehicle for the experience you’re about to be taken to? What are you, talking about a wallpaper color or like the color of the floors? So what are you talking about?

    Bill: Yeah. So, trims, maybe it’s the type of wood or the color scheme or the feel. Are you a rugged type of person or are you more of a plush person? That’s really the high-end experience. When you’re paying the low to mid six figures for a vehicle, you can begin to enjoy—

    Bonnie: Anything you want.

    Bill: Pretty much, right? And that’s the whole idea. It’s really a concierge experience and it’s all powered by SAP and our hybrid product suite as well as our S/4 enterprise and our operating environment for ERP. So it’s just really, really fantastic.

    Bonnie: Well, that is really exciting. I was going to ask you a question we do at the end of all of our Game-Changers show. Look into the crystal ball and tell me what you predict will be the most dramatic game-changer for automotive between 2020 and 2025, but in my opinion, I think you just told me already. But do you have a different game-changer you want to predict, Bill?

    Bill: Well, I think overall, everything is going to change. I think it was Mary Barra, CEO of GM, that said, we’re going to see more change in the next five to ten years in the auto industry than we have seen in the last 50. I think we’ve used this quote on your show before, but that was two years ago. It’s hard to really understand what the car as a vehicle will look like and express.

    For those of you listeners who want to learn more, we’ve talked about trucks. We’ve talked about passenger cars. We’ve talked about taxis even most recently, and those shows are all on-demand. But I think it’s really going to be a question of how does the value chain look? So you could argue that the automakers currently, today, could end up being the fleet owners.

    We all subscribe and you get a truck on the weekend and a nice passenger vehicle during the week and it rolls up to you and you drop it off or whatever. You buy subscriptions based on your miles and your vehicles come and go as you need them. Well, maybe the automakers don’t want to run that business. Maybe there will be emerging fleet companies.

    Maybe the next generation, maybe the Uberized version of the car rental industry as we know it today, maybe they’re going to own the fleet. They’ll manage the maintenance. When you operate a vehicle at 80-90% or higher, there’s a whole different vehicle maintenance model that you have to think about. That’s a cost.

    As we figure out how we monetize the vehicle today and into the vehicle tomorrow and we get to that tipping point where you’ve got more autonomous vehicles on the road than you do classic, traditional vehicles, that really becomes an interesting time. That’s the time where we get close to that. That’s when I think people are going to have to commit to certain business models and really take the plunge one way or the other.

    So, I think that’s going to be—there are so many things changing that I think fundamentally, who owns the fleet is really going to be the big change that we’ll see over the next ten to twenty years.

    Bonnie: Absolutely fascinating. Now I have one last question for you, Mr. Newman. I want you to just give me a one sentence answer because I know you want to get back to the event.

    The event takeaway—there are people who are not among the 400 or so people who are there with you and Pradeep and David and Stefan right now. Why should our listeners who did not attend this year—why should they plan to attend next year? What’s the top reason to be there at Best Practices in Automotive in 2018? Bill Newman, one sentence.

    Bill: I think it’s a homecoming and you learn so much from your peers. We mentioned it earlier—you just get to be with so many great people, people that we know, people that we work with, and you learn so much from those people and it’s not a pressure situation.

    Everybody’s here to learn and engage and to have a good time. And take at least one thing away that they can put to work either in their plan or immediately into their business when they get back to the office. It’s a homecoming for those that want to learn and have fun.

    I personally invite everybody to attend in 2018 back in Detroit and hope to see all of your listeners then.

    Bonnie: Thank you. Bill Newman, it’s always such a pleasure and I must say, I learned so much from you during our brief time together today. This interview will be posted on our Future of Cars with Game-Changers radio landing page very soon.

    I’m going to wish you a great rest of the event, Bill Newman. Can’t wait to hear what you have to say on our upcoming Future of Cars with Game-Changers radio shows. Have a great time and thanks for taking time out of a very busy schedule to meet with me, Bill. All the best.

    And to our listeners, I’ll be back with more very soon. Bonnie D. Graham, signing off. Have a great day.

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