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    How India's car market is undergoing a rapid change

    Synopsis

    The level of tech in new popular models in India is such that the ecosystem is witnessing a realignment.

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    Car companies have now changed tack to make sure it is the company the customer calls at the first sign of trouble.
    When Shubhankar Rawat, 39, bought a Kia Seltos sports utility vehicle in late December, he says it felt like an upgrade. The Korean automaker’s first offering on the roads in India was loaded with features thus far unheard of in a mid-segment car. It’s loaded with bells and whistles — three screens, including a retractable one, to handle vehicle health, navigation and entertainment duties; cameras and sensors all over; ventilated seats; the works.

    “It feels like top-end car features at a price point where Merc, BMW and Audi don’t even have a product,” says Rawat, a Gurgaon-based portfolio manager. The luxury carmakers, of course, have raced ahead on innovation and top-end models boast of voice and gesture controls with almost every part under the hood embedded with sensors, capturing data continuously with help just a touch away.

    Car companies have long tried to load vehicles with tech. But the level of tech and tech-enabled services in popular models now hitting the roads in India is such that the ecosystem is witnessing a realignment. Telematics, arrays of sensors and 24-hour live assistance mean car companies are having to upskill everyone from salespersons to mechanics, operate call centres and mount aggressive collaborations with tech companies or raise large tech divisions in-house, employing data scientists, software architects and programmers, to meet expectations about in-cabin features. This is spawning new jobs even as it renders parts of the older ecosystem — especially low-tech roadside mechanics — obsolete.

    Digital Dashboards

    “The car is becoming complex. It’s changing from a mechanical system to a smart, sensor-driven system,” says CV Raman, executive director and head of engineering at Maruti Suzuki India. The transformation is segment-agnostic. “We are aspiring to be a digital company,” says Manu Saale, MD & CEO at Mercedes-Benz R&D India.

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    In December, Mercedes-Benz launched a model with voice and gesture controls. You can ask the car what’s the weather at your destination, or if there’s an Italian restaurant close by, for instance. The car will not only give the options, but also take you there should you like to go. “What’s available in high-end vehicles today will be available in small cars tomorrow,” says Ganesh Kalyanaraman, global delivery head for manufacturing, logistics, energy and utilities at Cognizant.

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    As core vehicle features such as engine, capacity and comfort have become optimised and harder to base differentiations on, the competition has moved to make cars smarter and more connected, in a bid to make in-cabin experience the edge against competition. This means manufacturers are packing cars with computers and sensors. Apart from monitoring and optimising every aspect of a vehicle’s performance, the computers and a mobile internet link also make sure the car is never off the grid. What can’t be fixed automatically (like a leak in the coolant pipe or brake pad clogging) results in an alert on the dashboard. Data is stored on on-board computers or transmitted to the cloud where the manufacturer can monitor in case of a call for help.
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    “A luxury vehicle has the computing power of 20 PCs (personal computers), and about 100 million lines of code. It has 50-100 CPUs and can process 25 GB of data every hour,” says Kalyanaraman. Today’s cars are an integration of information technology (IT) and operational technology (OT), resulting in what’s broadly termed as a connected car.
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    “A Mercedes has more lines of code than a Boeing Dreamliner 747. There are at least 100 ECUs (engine control units) in a top-of-the-line car,” says Saale. Lingraju Sawkar, GM, global technology services, IBM India/South Asia, adds: “Spends (by auto companies) on classic IT are reducing while spends on business IT are increasing.” By classic IT, he means traditional solutions such as enterprise resource planning software, emails, etc. IBM partners with a host of carmakers to make them smarter. For example, if the brake pad is good to last another 25,000 km, the sensor should send that alert to the owner’s app or the car’s screen well in advance to replace it.

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    Tech Partners
    Carmakers are partnering with hardware and software developers to get that smart edge. Take MG Hector, China’s SAIC Motor’s first offering in India. It has partnerships with Cisco, Microsoft, SAP, iTeligence, Adobe, Cognizant, Panasonic and TomTom (for maps). Chip makers Infineon Technologies, NXP and Western Digital are eyeing big business from carmakers. Maruti has a core team of 110 staff in IT and also works with partners such as Wipro, Infosys, IBM, NXP and others to develop hardware and software solutions.
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    Gaurav Gupta, chief commercial officer, MG Motor India, says, “The Hector comes with over-the-air software update capabilities.” That means much like a smartphone, it can upgrade its software via wireless internet connectivity.

    When Tesla first introduced the feature in 2012, it caused a sensation in the auto industry. Now a car priced upwards of Rs 12 lakh has the same features.

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    Among American carmakers, GM introduced the feature only in 2019 and Ford has said its vehicles will get the capability in 2020. Mercedes prefers to do it all in-house at its R&D units in Bengaluru, Sunnyvale in California and at its headquarters in Germany. “It’s all too valuable to be outsourced. When it becomes commodity, maybe we will,” says Saale.

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    Even in features such as in-car navigation, which has been around for a while, there’s constant pressure to upgrade. “There’s demand for better experiences. Maps, for instance, moved from 2-D to 3-D to now high-definition. Cameras are becoming more intelligent. Topend models can easily use up to 1 TB of storage while a mid-range car will have around 256 GB storage,” says Vivek Tyagi, senior director for enterprise sales, India & South Asia, Western Digital, a US-based hard-disk maker and data storage firm.

    Dashboard as a User Interface
    Real-time data processing has led to increasing on-board storage. While data is moved to the cloud eventually, a lot of data critical to the vehicle’s operation is stored on-board to avoid any lag during the exchange over the cloud. “Parts that need to process data real-time can’t take a chance and that’s pushing the envelope for bigger hard disks within cars,” adds Tyagi.

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    This has resulted in new design concepts as well. Sanjay Gupta, vicechancellor at World University of Design, a Haryana-based institution, says carmakers are trying to turn the experience in the cabin akin to one that users are familiar with — using a smartphone.

    “The focus is on making the interface similar to a smartphone operation with features such as easy scrolling and swiping. The dashboard should be able to implement GPS, play music and videos and log data.” With the dashboard becoming a user interface, “design focus is on making them flexible unlike earlier when they were fixed”, Gupta adds.

    While the focus of innovation currently revolves around comfort, connectivity and safety, it all started with regulation compliance. Before emission laws came in, it was possible to build a car without a smart sensor. Now even entry-level cars come with at least an engine control module (ECM) to monitor emissions and keep them at acceptable levels.

    “Now this has scaled further to make cars better and create a smartphone kind of experience on wheels. All systems in a car are connected to a CAN or controller area network. CAN sends signals (via alerts on apps or in-car screens) to enable, disable things or even repair/replace them,” says Maruti’s Raman.

    More Business for Carmakers
    Earlier, a customer’s relationship with a car dealer rapidly diminished once the car left the showroom. Mechanical parts could be repaired by roadside shops which were usually 30-50 per cent cheaper than authorised service stations, notwithstanding the risk. “Buyers disappeared after the first three free services,” says a dealer.

    Car companies have now changed tack to make sure it is the company the customer calls at the first sign of trouble. Expensive modern cars at any rate cannot be repaired by roadside repair shops. This, the automakers hope, would improve lifetime revenues from a vehicle.

    This has spawned a new support ecosystem. In December, Bosch started an emergency call service in India for Mercedes-Benz customers. The service is supported by data and call operations centres in Bengaluru and Coimbatore.

    Bosch, which supports Mercedes globally, declines to share employee numbers but a spokesperson said the current set-up is capable of supporting up to 1 million cars. The call centre responds automated/manual alerts and supports arranging response when needed. Besides help for any engine-related problems, it enables access to 13,500 hospitals and police stations across 27 states and 5 Union territories. The assistance is provided in Hindi and English.

    Upgrading Mechanics
    In 2018, Maruti launched Suzuki Connect, an embedded device that tracks the location and key performance parameters of a vehicle in real time. Information about the car is relayed to the cloud and can be accessed by the company and its dealers. Available in four of its top models, Suzuki Connect at the backend is supported by 10,000 people manning call centres and service stations. “We offer over-the-air software upgrades. And in case you need a mechanic to attend, much like hiring an Uber, you can track their location and the time they will take to respond,” says Rajesh Uppal, CIO at Maruti Suzuki India.

    Suzuki Connect costs Rs 10,000 for a three-year subscription. In the last 12-18 months, 6,500 technicians have been trained to install Suzuki Connect and this could increase to 10,000 in the coming months. MG Motor has partnered with Bajaj Allianz for roadside assistance. The company claims its Pulse Hub call centre, managed internally, will answer queries within 10 seconds.

    Dearer Cars:

    All this means buyers are also more for support. Companies take anywhere from Rs 10,000 to Rs 30,000 for up to three years of maintenance. “Earlier when I bought a car I didn’t really need to go back to the dealer for expensive repairs as there was always a good option in the neighbourhood which was 30-40 per cent cheaper than the manufacturer. Now that option has gone,” says Pooja Mittal, a Delhi-based marketing professional, who sold her 2007 Innova and bought a Hyundai Creta in mid-2019.

    Mittal is happy with her purchase. “It’s an upgrade. Cameras make life easy when parking and reversing. Inside the car I’m connected automatically via Bluetooth, so I don’t need to reach out to my phone if it rings or to read messages quickly,” she says. However, “the wireless charging pad is not good to charge the iPhone 7 and the location of dashboard screen which show maps and other alerts could be better as I have to take my eyes off the road to look at them”.

    Raman Roy, chairman-cum-managing director of Quatrro BPO Solutions, who drives a Toyota Camry, says: “The roadside fellow has no answer to any problem, barring a flat tyre or replacing a fused bulb. I had a problem with lights and had to take it to the company to fix them as lights were software-driven. You are stuck even for basic things like car lights.” The prospects for the ubiquitous roadside garage, therefore, are bleak.

    Kavan Mukhtyar, partner & leader, automotive, PwC India, believes that by 2025, about one-third of the cost of the car will be accounted for by computers on-from about 10 per cent at present. “Car is becoming a moving computer. Roadside garages will see a dead end unless they become part of a bigger network, aligning with carmakers.

    Vehicle as a Service (VaaS) will be a new business model and up to 50,000 new jobs will be created in the next three to five years to support the cars.” Western Digital’s Tyagi sees car companies tying up with local repair garages to deliver services, “much like e-commerce companies partnering with kirana shops for quick delivery”.

    Delete the Data
    Buyers will have to pay more for service every year and will even sign up for multi-year maintenance contracts. They will have to get used to software upgrades, firewall protection, diagnostics via app and hooking up with call centres for assistance. And buyers are keen, even in the used car market, to get a tech-loaded car.

    Sunny Kataria, VP, Auto, Olx India, says: “Ownership period of cars has declined from 7 years to 4 years and is expected to touch 3 years in 2020 — almost smartphone kind of replacement cycles. Cars with tech features can fetch 10-12 per cent higher prices than regular cars.”

    While many might be keen to upgrade to new models, the level of data logging means owners must be careful to delete and reboot before selling a tech-loaded car. Much like a smartphone.


    Future Ready
    Smarter, connected cars will not only predict what is ahead, but even fly
    Sony Vision S
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    What happens when consumer electronics giants design cars? We have at least one answer in Sony Vision-S from Sony Corp. The car has 33 sensors, including 12 cameras, three solidstate lidar sensors (to measure distance using laser), and 15 radar and ultrasonic sensors. The combined hardware monitors traffic, road, driver and passengers. The dashboard is a screen that stretches between the pillars. If you don’t see Vision-S on the roads in the coming years, you might find all the tech wizardry in cars that use this licensed tech from Sony.

    Hyundai Uber Flying Car
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    South Korean carmaker Hyundai aims to free up road traffic and make people zip across cities. The answer is a flying car, targeted at people in megacities like London and New York who can afford helicopters to get around. The electric flying car will have a range of 100 km per charge and recharge in 5-7 minutes. The plan is to mass produce these 5-seater vehicles and deploy them for Uber’s air taxi network. Tests are due in 2020-21 and deployment is likely in 2023.

    AI-powered Sun Visor
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    It is the biggest upgrade of a car part that has barely changed for decades. Bosch has introduced artificial intelligence (AI)-powered sun visor called Virtual Visor. The visor takes the form of a rectangle that swings down from the headliner to block sunlight. It is a transparent LCD screen that uses an occupant-monitoring camera to track shadows across the front passengers’ faces. AI then identifies facial features and uses this information to tint only the parts of the visor through which sunlight hits the passenger’s eyes, creating a shadow that looks like a robotic Venetian mask. The rest stays transparent. All this for a safer drive.



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    ( Originally published on Jan 18, 2020 )
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