Accenture: New mobility and digital services to drive future growth, not car sales
CGTN Global Business
["china"]
07:06
At a time of demand uncertainty, tougher emissions regulations and investments into new technology, global automakers feel an increased margin pressure. New mobility and digital services, rather than car sales, will be the key driver for auto growth in the future, according to Managing Director of Accenture Greater China Roland Mayr.
"I think the profit coming from car sales will be decreasing, relatively to the profit coming from new mobility and digital services, such as parking, charging and infotainment," Mayr said.
Accenture research showed that by 2030, revenues from manufacturing and selling vehicles of around 2.2 trillion U.S. dollars will be only marginally higher than they are today, and that profits from car sales will even shrink slightly, from 126 billion euro (142 billion U.S. dollars) to 122 billion euro (137 billion U.S. dollars). By contrast, revenues from mobility services are projected to soar to almost 1.2 trillion euro (1.3 trillion U.S. dollars), with profits reaching as much as 220 billion euro (248 billion U.S. dollars).
"The principle strategy is clear – you need to make money off your existing businesses, drive cost down to be able to re-invent into a new business," Mayr explained.
CGTN interview with Managing Director of Accenture Greater China Roland Mayr. /CGTN Photo

CGTN interview with Managing Director of Accenture Greater China Roland Mayr. /CGTN Photo

Highlights of 2019 Shanghai Auto Show
Mayr saw some differences in this year's Shanghai Auto Show. The first being the electric vehicle, which is "a deeply dominating thing" from his perspective, adding that "investment in the electric segment has certainly paid off.
"The second thing I guess you can really tell is that Chinese original equipment manufacturers (OEMs) are stepping up in terms of quality," he told CGTN, adding that the third thing is that "2019 can become a significant year in the way that global auto market becomes a bit of a level playing field, with Chinese OMEs creating models for the western market and western OMEs creating models, even brands, for the Chinese market."
Chinese auto market outlook
Mayr is positive about China's auto market this year, despite the downward performance last year. Based on his view, the electric segment remains a rally.
According to the China Association of Automobile Manufacturers, sales of NEVs soared last year, up 61.74 percent year-on-year. "That makes me confident. Every production unit makes things somehow cheaper, brings the cost down and makes it more affordable to the consumer," he said.
As China is unlocking its joint venture limits in the auto sector, foreign carmakers are raising stakes in their JV's in the country. Mayr was not surprised by that trend, and expected more collaborations between western and Chinese automakers, "for joint developments of batteries, car platforms, etc."
"Who will be the beneficiary? The consumer," Mayr told CGTN.