The automotive industry is one of the UK’s fastest-changing sectors, something that is all too evident when those who only trade in their cars or vans on an irregular basis finally decide to upgrade. Much of this is as a result of technology, whether that’s simply reflecting wider consumer trends or more fundamental changes that could affect the design and role of vehicles and even how we move around in the future.
Legislation is a key driver, particularly the need to reduce carbon. “This means that the technological features revolve around new regulations and customer demand,” says Felipe Munoz, global automotive analyst at automotive business intelligence provider JATO Dynamics. “The turbochargers developed by some premium brands are a good example: they used to be the primary way to boost speed and acceleration. Now their focus is to improve driver experience and efficiency.”
The efficiency quotient
Manufacturers are seeking to make cars more efficient in two ways, driven largely by the requirement to reduce average fleet emissions to 95 grams of CO2 per kilometre for all new cars. One is to reduce fuel used; something that has been a focus for the Institute for Advanced Manufacturing and Engineering (IAME), a partnership between the University of Coventry and Unipart Manufacturing Group.
“One project is with Ford, where we have helped them develop the technology for increased pressure in gasoline direct injections to reduce fuel consumption,” says Dr Carl Perrin, director of IAME.
The second trend is around reducing the overall weight of the vehicle. Some of this is achieved through the use of different materials – the American Chemistry Council estimates the proportion of steel has fallen from 43% to 35% of total weight since 1998, while aluminium has risen from 6% to 10% – but also from reducing the weight of particular components and parts.
IAME has been involved in a number of projects, says Perrin, including on the Aston Martin Vanquish. “We looked at where all the mass is in the exhaust and challenged everything from the thickness of the tubing to the heat shields and the joining methodology,” he says. “We were funded through an Innovate UK project to target a 50% reduction in the weight of the exhaust. It’s about 13kg, from a total mass of 26kg. We did that through using different materials, downgrading other materials and then developing all the joining and forming technologies needed to go with that.” The system is currently at the prototype stage but Perrin hopes it will move into production later in the year.
Another project has been with Jaguar Land Rover, where the focus has been to reduce the weight of the muffler box on exhaust systems by using acoustic technology rather than physical components to eliminate noise. “It means we can deactivate some of the cylinders so we’re burning less fuel, but we can still make it sound like a V6 or V8,” he says.
Connecting the dots
Another big area for the sector has been the development of internet-enabled or “connected” vehicles. Research by JATO Dynamics suggests 18% of vehicles registered in the UK in 2015 had some form of internet connection, and this figure will undoubtedly rise in the future. In the car, this is giving rise to a number of new developments designed to give owners or users more control. “Apps for connected cars, along with the telematic box – an in-car SIM – will enable users to manage their car remotely, so to check gas levels, lock the door, check driving performance, receive theft notifications, and control other elements such as starting up the engine or putting the alarm on,” says Munoz. “The ultimate aim is to do all of this via a smartwatch.”
The technology also opens up possibilities around vehicles communicating with each other or with broader infrastructure. Examples here include intelligent transport systems which could alert drivers to traffic conditions, tolls and optimum routes, as well as driver assistance systems to control speed, stability and even emergency braking if required.
Proportion of steel has fallen from 43% to 35% of total weight since 1998
Nick Reed is academy director at The Transport Research Laboratory, which has recently been working on a European project called COBRA, looking at the benefits and concerns around such systems. He foresees a future where car journeys become more personalised – with apps advising drivers to park some distance away from their destination to reach a step target for the day – as well as vehicles providing information and assistance around parking and warning drivers when services or repairs are needed.
But he also has concerns. “Drivers and passengers will be able to experience smoother, faster and more coherent access to smartphone functionality such as calls, email, social media and multimedia applications, but it is critical to recognise the potential for driver distraction,” he says. “With more devices
to catch their attention, drivers may miss critical information as they are engaged in other activities or browsing through menus.”
There are also fears around security, warns Simon Viney, director of
cyber resilience with Stroz Friedberg. “This offers the opportunity for cyber- attackers to steal valuable data, goods or vehicles, or disrupt the operation of ‘connected’ cars,” he says. He gives the example of the Jeep case, which forced Fiat Chrysler to recall several million vehicles in 2015 after hackers managed to gain control of a vehicle.
“In addition, some 6,000 cars were reportedly stolen in London in 2014, after hackers identified a way to readily bypass a keyless entry system used by several manufacturers,” he adds. “Attacks such as these only become more sophisticated and easier to conduct once an attack is successful.”
It’s a concern shared by Mark Taylor, technical manager, technical innovation at ICAEW’s IT Faculty. “You tend to find on engineering projects that people get very excited and think about great things, and then they think about security after,” he says. “It’s important to think about security when you’re starting to build the system; it will only get worse unless car manufacturers think more about this in the process.” Privacy of customer data is also a concern if vehicles communicate with call centres, he adds.
Electric vehicle technology is – finally – starting to make a real impact, as concerns over driving range and charging infrastructure start to subside. According to The Society of Motor Manufacturers & Traders, some 2,400 electric vehicles a month were registered in 2015, compared to just 500 the year before. Today, there are more than 75,000 electric vehicles in the UK.
“I believe that this growth will continue and result in 85% of all new car sales being electric by 2035,” says Erik Fairbairn, founder of POD Point. “What’s really driving the growth is a recognition of their superiority over vehicles with internal combustion engines. Put simply, electric cars are easier to drive, quieter on the road, require less maintenance, cost less to run and are altogether more fun than their petrol counterparts.”
Nick Reed forsees a future where car journeys become more personalised, with apps advising drivers, as well as vehicles warning when repairs are needed
Part of this is also due to the emergence of manufacturer Tesla, which is pushing a combination of new models and investments in battery technology, and is currently seeking to acquire SolarCity as it attempts to tie in renewable technology with electric charging capabilities in the home. The new Models S and X have a range of over 300 miles, helping to make electric vehicles a more viable option for those looking to do more than local trips or city driving.
But electric vehicles – or hybrids – are not necessarily the only option in moving away from petrol or diesel. “In the future there will be a range of fuel types dependent on actual transport needs, from pure electric vehicles to gaseous-powered vehicles, including hydrogen,” says Chris Chandler, principal consultant at Lex Autolease.
“But there are many obstacles to overcome with hydrogen fuel cell vehicles, and the effective production and distribution of hydrogen that many people do not fully appreciate. Rather than questions about brand style and image, drivers should be asking what sort of vehicle technology is the best for the kind of driving they do.”
Autonomous vehicles, where elements of, or even all, the driving responsibility are taken away from the driver have also grabbed the attention of many in the sector. “Automation of the driving task is happening now,” says Reed. “Basic automation systems such as adaptive cruise control and automated parking are widely available on everyday vehicles, while higher levels of automation are in development. Full-scale road trials as well as laboratory tests, such as the GATEway project led by TRL in London, are underway.” Again, though, this needs careful handling, he warns, with a risk that drivers become over-reliant on the technology and literally take their eyes off the road.
Stan Boland, CEO of FiveAI, believes even the most advanced vehicles are currently only at level two or three on the autonomy framework developed by the Society of Automotive Engineers. “Level 5 describes a state of full automation where no human input is required, with level 0 representing no automation whatsoever,” he says. His organisation is currently building a prototype platform which he believes will move the sector towards level 5, and sees a future where customers buy “mobility as a service” rather than owning their own vehicles, which could see the numbers required falling but the demands on these increasing.
How this space develops depends in part on the competing technologies, with radar and LiDAR (light detection and ranging) complementing and competing with V2X and more conventional camera systems. Georg Schweighofer, marketing director at Qualcomm, is a strong advocate of V2X, which he sees as a stepping point on the road to 5G, and particularly the fact that it does not need to have line-of-sight vision to make driving decisions.
Others see cameras as more practical and cost-effective. RDM’s Pod Zero range, for instance, relies largely on cameras, and is targeted mainly at local city transport authorities, airports, shopping centres and theme parks looking for a first- or last-mile service, rather than for use on main roads. “Trials of our vehicles are underway in Milton Keynes and we’ll start in earnest in Coventry next year,” says Miles Garner, sales and Marketing Director at RDM Group.
The audit role
The emergence of such vehicles – and the connectivity around them – also means there is a growing requirement to monitor and audit claims made by manufacturers, and accountants may find themselves playing a role here in ensuring such statements stand up to scrutiny.
“If you’re the people making the claim then you would want to get assurance to support that and if you’re someone challenging those claims you may want to get someone to audit them,” suggests Stephen Ibbotson, director of business at ICAEW. “There is a role in understanding that data and what it means rather than just presenting lots of numbers, so accountants could end up specialising in this area.”
Indeed, the whole sector has found itself under greater scrutiny since 2015 and the Volkswagen emissions scandal, followed by Mitsubishi’s admission this year; something ICAEW CEO Michael Izza says demonstrates the need to embed integrity throughout organisations. “The tone from the top – set by management – is critical, but it is not enough,” he wrote in a recent blog. “It must also be translated down through the whole of the organisation. If people at lower levels think hitting sales targets is more valued than behaving ethically, this will cause problems.”
Other technological developments are also having an impact on the sector, including how people source vehicles in the first place. Rob Abrahams, market development manager at carwow.co.uk, says the move towards self-service – as seen in internet businesses such as Uber, AirBnB and boohoo.com – has created a rise in people researching and comparing cars of different brands online, rather than trawling round manufacturer-specific showrooms.
“Imagine going into John Lewis for a TV and being directed to different floors to look at different brands – it’s nonsensical and not consumer-centric,” he says. “Brand is an important filter, but it’s not the starting point.” In fact, many customers are now choosing to effectively buy vehicles through personal contract purchase rather than pay for them outright; 59% of all private new cars bought in the UK in the year to July 2015 were financed in this way, according to LeasePlan.
Antoine Weill, automotive sector partner at consultancy Simon-Kucher & Partners, also points to the impact 3D printing could have in the replacement parts arena. “This will turn current supply chain concepts upside down by substantially lowering inventory, transport and insurance costs,” he says.
“If car manufacturers or original equipment suppliers do not embrace this technology early enough, aftermarket players will. In doing so, they will be in a position to provide better service at a lower cost for customers, who are increasingly rational and well-informed.”