It’s more than a buzzword – it’s a reality. The proverbial foot is on the gas, and the hands are definitely off the wheel…if there is one.

Still squarely in the testing phase, autonomous vehicles could start entering our roadways in higher numbers starting as early as 2021. Much has been said about the multitude of questions and concerns as to how this revolution will affect how we live, globally: what it will mean for infrastructure, travel, health and society. But what about manufacturing? How will these changes to transportation impact what cars are produced, how, and on what scale?

In a recent presentation at the South Carolina Automotive Summit, Gary Silberg, KPMG Head of Automotive for the Americas, made a few predictions that auto makers should heed. KPMG’s research piece, “Islands of Autonomy” predicts that metro areas of 500,000+ residents will see the first wave of autonomy, which will be responsive to a variety of factors including trip time, distance and number of passengers. These factors will dictate what types of vehicles are on the road, and will be specific to the metro areas in question, as each area will have distinctly different patterns of travel. These factors have the potential to bring about the production of new automobile models, and signal the decline of others (spoiler alert: don’t get too attached to your sedan).

These changes will occur in a domino-like fashion, with technology and services leading the way and manufacturing riding the wave like a longboard. So, what will this mean for manufacturers?

Retooling. We’ve already seen Chrysler and Ford re-evaluate their product mixes, giving them the opportunity to retool those lines to accommodate other models or increase production on existing models. Begin planning early, as massive retooling projects can be years-long efforts. What do you need to do within your factory today to plan for the lines you will need in 2021? 2023? And beyond?

Increased, and More Sophisticated Testing. Taking the vehicle out of the hands of the operator means some interesting things will happen in the realm of liability (which is a whole other topic). To be prepared to circumvent any issues with potential liability in the future, manufacturers need to invest in autonomous testing tracks, as well as the rapidly-evolving technical platforms that support navigation and collision avoidance, including simulation that includes deep learning.

A New Primary “Consumer”. Less cars getting in wrecks, less personally-owned vehicles… that sounds like bad news for manufacturers, but it’s not. As personally-owned vehicles decline, more vehicles will be owned by Mobility as a Service (MaaS) operators like Uber and Waymo, meaning that the model of how OEMS do business will shift from a primarily business-to-consumer basis to a more business-to-business basis. MaaS companies will be interested in economy of scale, durability of product, and of course, trip efficiency in order to meet their bottom line. This may not affect what happens on the factory floor, but it will certainly be a shift in how OEMs do business.

New Vehicle Styling. Today, consumers purchase cars for their utility, performance or style. But once MaaS fleets become the primary customer, this will have a major impact on how OEMs develop new product lines that are responsive to different fleet needs. In-city trips will need different vehicles than city-to-suburb trips, and so on, as KPMG has suggested.

Economy of Operation. While it’s currently an issue from an environmental standpoint, economy of operation will now become a major business driver. Whether the vehicle is propelled by gas, electricity, hydrogen, or some combination, economy of operation has a direct correlation to vehicle weight. If manufacturers have been hesitant to incorporate large composite pieces into their vehicles due to the time constraints of producing those parts, the changes in production may allow for greater integration of composites, which will be attractive to MaaS buyers interested in getting the most for their investment.

BRPH, through our work with automotive and information technology clients, understands that testing new technologies is the most critical step in a go-to-market strategy. Whether that means testing new deep learning software in state-of-the-art simulation environments or track-testing automotive components in a closed or open test bed, manufacturers will need to invest heavily in those facilities that prove these technologies to be trust- and road-worthy. As a firm, we have learned that these facilities directly impact the market outcomes of the innovation they foster, and we will be working closely with our clientele to design those spaces and environments to support a safe, efficient and convenient autonomous future.

About the Author:
Michael Pacheco has over 35 years of experience in Automotive and Industrial manufacturing, specializing in paint, and research & development facilities. This experience includes design lead roles, project management and firm management of an automotive, multi-discipline practice. As the Director of Automotive for BRPH, Michael is responsible for firm performance in all automotive projects.