New Trends in the Automotive Industry
The automotive industry hit a record amount of sales in 2015, and the trend seems on track to continue in 2016. Stronger ties to Silicon Valley promise to bring about fresh technologies that will change the driving experience, including a focus on self-driving cars spurred on by the increasing popularity of ride-sharing services. With these developments on the horizon, 2016 seems poised to be a pivotal year in the history of the automotive industry. Let’s see what new trends in the automotive industry lie ahead.
Used Car Sales on the Rise
In 2015, used car prices were kept relatively high thanks to strong demand from consumers. However, an estimated three million cars currently on lease are about to hit dealer lots, flooding the market with an increase of over 800,000 used vehicles. With an inventory level not seen since 2004, car dealers may find themselves struggling to sell new cars, especially to the millennial generation. Millennials are becoming increasingly more interested in used cars, and certified-pre-owned programs only make these vehicles more attractive as used car inventories grow.
SUVs and Crossovers Continue to be Popular
One of the new trends in the automotive industry that is not so surprising is the popularity of SUVs and crossovers. The persistence of low gas prices is partly responsible for keeping SUVs and crossover vehicles popular among drivers. Sales of compact crossover models and SUVs took 14 percent of the market in 2015, surpassing sales of mid-sized sedans by 0.4 percent. If the fuel efficiency of these vehicles was still at the same level as a decade ago, the trend may not have persisted, but with improvements in design, U.S. drivers can enjoy driving larger vehicles at lower costs.
The Unsure Future of Volkswagen in the U.S.
The emissions scandal that came to light in September of 2015 may threaten the position of Volkswagen in the U.S. market. After rigging 600,000 Volkswagen and Audi diesel models to get around the Clean Air Act, the German company estimates that it will have to buy back around 115,000 vehicles, offer discounts on new vehicles and somehow compensate owners for repairs and refits on the remainder. The negative publicity caused U.S. sales of Volkswagen vehicles to drop 5.2 percent in December of 2015, with sales for the year as a whole dropping 2 percent. As of yet, the company hasn’t revealed a clear plan on how it will deal with the backlash.
Connected Cars: Advancements in Technology
Changing technologies are bringing the concept of a connected car much closer to reality. In the near future, cars may be able to “learn” about driving patterns and use the information to create the best possible experience on any given day. Collected data may also be useful for predicting necessary maintenance. Improved safety features designed to prevent accidents are in the works, and continued increases in security are being implemented to offset the vulnerabilities created by greater connectivity. With companies like Google, AT&T and Microsoft all fighting for space in this developing market, this trend should be especially interesting to watch as it unfolds.
More Ride-Sharing for the Masses
Uber, Lyft and other ride-sharing services are blowing past taxis in popularity and beginning to threaten the auto rental industry. According to research conducted by Ford, use of these services in the UK alone may grow by as much as 23 percent by 2025. For automakers, this means a new era in which consumers increasingly rely on others to transport them rather than buying vehicles of their own. However, with lawsuits popping up and regulations beginning to be proposed in many areas of the U.S., the future of ride-sharing is far from certain.
Autonomous Car Competition Heats Up
With Ford, General Motors, Kia, Toyota and Volkswagen all announcing that they’re working on plans for cars that can drive themselves, it’s beginning to look like autonomous vehicles will truly be the wave of the future. The technology isn’t in place to support a fully autonomous driving experience just yet, but more features are expected to be introduced in coming years to move vehicles in that direction. Surveys conducted by Ford show that the global market is more than ready for the autonomous experience, with 84 percent of Chinese and Indian respondents showing interest in owning such a vehicle.
What’s in the Future for Infotainment?
The 2016 Consumer Electronics Show (CES) offered some insight into how infotainment is poised to merge with the driving experience. Spurred on by Apple and Google, automakers are introducing their own ways for drivers to interact with their vehicles. From Volkswagen’s eGolf-Touch to Ford’s SYNC AppLink, drivers will have more choices than ever in how to experience media and utilize navigation tools. Open-source options could provide stiff competition for Google CarPlay and Android Auto by allowing any developer to create apps that will work on the new platforms. Over time, touch screens controlled by gestures are expected to eliminate dashboard dials, and some manufacturers predict that future vehicles may include interactive interiors with the ability to respond to touch.
As these trends in design and technology become the new normal, consumer reactions will ultimately be what drives the industry to continue to adapt and expand its offerings into unexplored areas in the world of transportation.
Which new trends in the automotive industry do you find the most interesting?
Are there any trends you’ve been following that weren’t mentioned?
Is there anything new that you’d like to see auto makers do in the future?