Structural trends

How consumers view and then purchase goods and services has transformed over the past 20 years with the substantial growth in online shopping, and rapid delivery services.

This has prompted growing awareness and concern about the environmental impact of consumption and logistics, with campaigns to “shop local” and for zero carbon deliveries. E-commerce companies are increasingly seeking to decarbonise their transportation and logistics, especially in urban areas.

Customers are developing much higher service expectations across their interactions with businesses in all sectors, expecting connected customer journeys with consistent and seamless interactions across organisations, departments and sales channels.

Customers also look for better personalisation of services and data as technology advances, expecting companies to understand and adapt to their changing needs and preferences.

Advances in technology applications are driving significant organisational change. Opportunities from digitalised processes increase the ability for efficiencies, better understanding of data and can offer competitive differentiation.

Recent uncertain economic conditions have further expanded demand for outsourcing solutions, with businesses seeking out external expertise for non-core areas. The trend is also shifting towards building strategic partnerships with fewer outsourcing companies.

Changes in business models and rapid technology advances have led to a rise in skills gaps in areas needed to create the digital, electrified and sustainable mobility of the future.

This can be seen in areas such as vehicle repair and is shaping organisational training programmes. This reflects the greater necessity for vocational training to manage increasingly complex vehicles combined with the transition to electrification.

The global economy is consuming a diminishing supply of non renewable natural resources. This is driving an increasing focus on efficient resource management and pursuing circular economy principles, including shared ownership, outsourcing and repurposing.

There are many high-value materials in vehicles which are already captured and recycled, but this is being extended across the supply chain, with an increasing focus on minimising landfill and reuse or repair of non-degradable elements such as plastics.

Mobility remains a fundamental societal need but unconstrained growth in mobility is increasingly unsustainable if it translates into an increase in traffic and in carbon emissions. Around 60% of the world’s population lives in cities and urban areas where 70% of greenhouse gas emissions are generated. The densification of living and traffic congestion are a growing issue for cities to tackle, dealing with challenges like air pollution.

Delivering cleaner, safer, more inclusive mobility systems allied to affordability and accessibility are key to future sustainable mobility development.

Significant global research and expenditure has been focused on finding lower carbon alternatives to ICE vehicles. Technology research has expanded from focusing principally on EV battery technology through to other solutions such as rapid battery replacement and alternative fuels, as issues of range and payload continue to remain a significant challenge.

New OEMs are emerging with technology solutions, putting pressure on the traditional market leaders and may redefine this market space, including an erosion of traditional dealership and servicing business models.

Policymakers are increasingly confronted by real and perceived trade-offs between energy security, affordability and sustainability, giving rise to a slower and more disorderly energy transition, creating uncertainty in many business sectors, including automotive.

There is currently insufficient public investment in charging infrastructure, in both urban and rural areas. This is compounded by increased charging costs related to rising energy prices, all of which has undermined lower carbon total cost-ofownership savings.