Industry 4.0 ignites change in motor industry

Abdullah Verachia, global strategist, speaker and facilitator on making sense of disruption, believes that there will likely be five major disruptors in the motor industry in the next few years. Firstly, he mentions the movement from combustion to electric becoming much more pervasive. “We will also see fully-connected digitised cars that do much more than get you from A to B. Cars are becoming spaces to work, to shop online, to watch movies, to connect to medical professionals, and more.”

Next is new forms of mobility. “As we see rapid urbanisation new forms of mobility will become the new normal. These include current options such as Uber, Lyft and better public transport but also sharing applications like ZipCar.”

Fourth on his list is the changing nature of work which, he believes, will mean less trips and thus less dependence on vehicles which makes new mobility options more attractive. Lastly autonomous vehicles. “Autonomous vehicles are still far off in its pure form but will become very prevalent in elements such as highways,” he says.

So, is South Africa lagging behind other parts of the world when it comes to Industry 4.0 in relation to the motor sector?

Verachia says both yes and no. “South Africa is particularly great in terms of model launches that align to global cycles. Where we are lagging is in terms of the redefined concept of urban mobility. I was in Munich recently and drove 11 difference cars through a car app. I was able to drive through multiple cities through seamless mobility.”

He adds that there are, however, mavericks in the South African motor industry doing interesting things. “WeBuyCars has really transformed the buying industry. They have created a seamless, frictionless car-buying experience.”

He also mentions the Daytona Group that has opened a motoring haven in Melrose Arch in Johannesburg by aligning to the global trend of motor retail being about an experience and not a transaction.

But what does the largest retail motor association in South Africa, the Retail Motor Industry Organisation (RMI), have to say about this changing landscape? Jakkie Olivier, CEO of RMI, says it’s challenging the South African motor industry to start assessing their businesses and where they need to be in the next five, 10, 15 years. “We saw how, almost overnight, the taxi industry was transformed with the introduction of Uber. While not all changes will be as rapid, we need to prepare for the likelihood that these disruptors will become the norm in the not-so-distant future.”

He says firstly understanding the possible impacts is important. “We know that alternative fuels and electric vehicles will affect how vehicles are serviced and repaired. This will have an impact on how technicians are trained and qualified. It will also have an impact on the traditional repair workshop and motor body repairers’ business. Then comes the parts industry. The number of replacement parts in an electric vehicle, for example, is far less than in a petrol or diesel-powered vehicle. Businesses are going to need to be flexible and adaptable or will become obsolete,” he says.

Olivier says the RMI is encouraging its associations to become immersed in what is happening internationally in their area of specialisation and to engage with stakeholders both locally and abroad. “It is a challenging time for the industry and we can’t afford to be left behind. The sector is a major employer with great potential for entrepreneurial businesses. We have to ensure that businesses remain relevant and new entrants into the industry can succeed.”

Verachia says the South African public is going to have to embrace many changes over the next few years. “Vehicle ownership is archaic. We have to redefine how the sharing economy fundamentally challenges the ownership models in the auto sector.”

He says that the Internet of Things and Sensors will allow us to do preventative rather than reactive maintenance. This, Olivier says, will be a big step forward in terms of safer roads and responsible driving.

Verachia ends with the Gautrain as an example of how public transport can truly redefine mobility. “The train has become an anchor spine between Tshwane and Johannesburg. We have to amplify this by using the model to provide safe, effective and workable public transport for all,” he concludes.