In The News

Diversity, electrification, and consumer engagement in the automotive industry

Article Date: 23 April 2022

As we enter into the second quarter of 2022, it seems an appropriate time to discuss the direction the automotive industry is going in and what our Director of Global Consulting, Mark Fennelly feels are the most important trends to keep an eye on this year. 

In this article Mark explores the following three key themes: 

  1. Diversity and inclusion
  2. The shift electrification
  3. Maximising customer engagement 

Women at the wheel 

Diversity and inclusion have been on the agenda for some time now, not only is the world opening up to include equality as an imperative for corporate businesses, but data shows today’s consumers are demanding diversity and favouring brands who are responsible. 

Although there have been some positive changes, the automotive industry is sadly lagging behind other sectors as it seeks to rectify the gender imbalance. Deloitte published a report showing that women make up just under half of the labor workforce, however, comprise only a quarter of the auto manufacturing workforce and fewer than 10 percent of executives identify as female. And a further 40 percent of women working in automotive would choose a different industry if they were starting their career again. 

Two factors commonly associated with under-representation: industry bias towards men for leadership positions and individual company culture. The automotive industry needs to drive greater representation by flattening the hierarchy and creating initiatives that engage all levels of the organisation.

Electrification to support climate change

Electric-vehicles are not a new concept, but their acceptance and popularity has grown dramatically since the Tesla Roadster and Nissan Leaf arrived on the market a decade ago. 

Fully electric vehicles have accounted for 15.4% of new car sales so far this year. The government's independent advisors the Climate Change Committee (CCC) recommends zero emission car sales should be 30% in 2024 and 73% in 2028, in order to meet the UK's net-zero climate commitments.

Research shows that electric cars are better for the environment as they emit fewer greenhouse gases and air pollution than petrol and diesel cars. The goal to achieve net-zero can appear to be a herculean task when we consider roughly 18.8 million runs on petrol, around 12.3 million on diesel.

However, it is achievable if you just look at Norway, where electric cars account for 55% of new car sales. Unfortunately, we know that people will not buy into electrifying to fight climate change if the price is too high. 

Driving consumer engagement 

Consumer behaviour has dramatically shifted in the last few years, the pandemic has accelerated the demands and distinct lack of patience from consumers across many industries, the automotive is no exception. 

While vehicle performance, design, and price remain important, consumers are now also focusing on receiving a connected and responsible experience. 

Google search trends suggest some 60 percent of car buyers under the age of 45 are likely to purchase their next car online and are interested in contactless sales and services. 

Digital is revolutionising the automotive experience from the point of sale which is no longer physical to a connected driving experience that enables the vehicle to generate and process large amounts of data for a seamless personalised performance. 

The future of the automotive industry needs manufacturers and suppliers to rethink their business models, focus attention on the consumer, and proactively commit to social and climate responsibilities. 

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