The clock is ticking for auto giants like VW, Daimler and BMW despite record sales of close to 16.5 million vehicles last year.
Analysts say the only way to protect their business is to invest heavily in new mobility services. Otherwise, they will eventually be degraded to mere components suppliers in an auto market dominated by software specialists, like ride-hailing service Uber.
Research by Boston Consulting suggests that sales of cars and components, which currently account for 99 percent of the auto sector’s earnings, will generate just 60 percent of earnings by 2035. The remaining 40 percent will come from mobility services.
“There’s a battle raging between two worlds — big data and the established auto companies,” said Stefan Bratzel, director of the Center of Automotive Management (CAM) at the University of Bergisch Gladbach. “The outcome is open, but it will be difficult for the auto companies.” Their many strengths do not include software development or building relationships with customers, he added.
Keeping rivals at bay
The danger is that Uber, Apple and Google, among others, will muscle their way in — unless a generation of ambitious German startups stops them. They include Berlin company door2door and its Allygator shuttle.
Door2door founder Tom Kirschbaum aims to make up to 97 percent of city cars obsolete. “If we put six to eight people heading in the same direction in a minibus, instead of having them each drive their own cars, we can save an enormous amount of money, time and CO2,” he said. Traffic jams would be a thing of the past.
The head of Daimler startup Moovel, Daniela Gerd tom Markotten, shares the same goal. “The vision of Moovel is a world without congestion,” she said. The Moovel app shows users options for getting from point A to point B, letting individuals rent transport and pay directly via smartphone.
The IT expert will run Daimler’s Car2Go and BMW’s DriveNow car-sharing alliance once the merger receives cartel clearance. Together, they have a customer base of more than 25 million people — a solid foundation to take on US and Asian competition.
VW is also tooling up against the tech giants. It wants its startup Moia to become one of the world’s leading mobility service providers by 2025.
Racing towards self-driving cars
The global race is on to develop the first safe and fully autonomous car. The first to employ that technology for shared mobility services in cities will have a crucial advantage. This will not only decide the fate of taxi scourge Uber, the world’s most valuable startup at $72 billion, but also that of big German carmakers.
Uber’s ambition is unbroken by controversy over its management style and its aggressive expansion, or by setbacks in Germany, where courts banned it from offering its standard ride-hailing service. It’s now confined to Munich and Berlin, and its cars there must be driven by professional drivers, not private ones.
“We want to be the solution people think of when they want to get from A to B,” said Uber product chief Manik Gupta.
But Mr. Kirschbaum believes German startups have a key advantage. “Uber, Lyft and Gett have shown how outdated taxis are. But there’s one aspect missing with all these mobility platforms. They’re not at all embedded in the public transport service. We’re going to change that.”
Franz Hubik is an energy correspondent for Handelsblatt. To contact the author: firstname.lastname@example.org