Driving the future of mobility
On Tuesday, March 26th we had the opportunity to get to know how automotive markets are changing, hosting the event "Changing gears: driving the future of mobility". The whole panel was moderated by professor Cristian Chizzoli and we had as special guests Gaetano Thorel, CEO of PSA Group Italia and Andrea Badolati , CEO of Ald Automotive Italia.
We started talking about how consumers are changing their behaviors when buying a car: it’s not that common anymore to have a car amongst young people since our generation’s lifestyle does not easily allow purchasing one. There are also many other factors that have threatened the traditional automotive business field, as the slow shift to electric cars, or the increasingly more complex digitalization of vehicles. Moreover, production has to take into account more restricted regulations and laws about vehicle circulation (like the recent introduction Area B in Milan) and pollution/environmental issues. << It’s not an easy business to work in >> they repeatedly said. The whole market had a static period in which, especially from the outside, it looked like it was ready to collapse. But how to run out of the killer zone? Top-notch companies realized that it was time to change the perception of cars from ownership to usership.
From "buyers of products" to "users of services"
Gaetano Thorel sees in this industry changes an opportunity for innovation. First, he stressed how we are shifting from buyers of products to users of services. The mobility revolution that is happening right now is facing so many drastic changes in how “transports” are perceived and demanded. There are so many innovations and aspects that just ten years ago were totally absent or ignored. Let’s think about the integration of GPS, Google Maps, intelligent electric cars - and so on. As a social system, we do not really care about owning something anymore, we just really care about getting the job done in the fastest, best way possible.
Car-sharing has revolutionised the way people in big cities can move freely around without having the stress to look after a car of property: 1km out of 3 is going to be shared within 2030, and just within 2025, there are going to be 36 MLN of car sharing users. A great car maker has to think about that. PSA is the parent company of the well-known brands like Peugeot Citroen, Ds Automobiles, Opel and Vauxhall; and since even big realities like theirs had to keep up with industry changes, they have introduced a mobility provider called FREE2MOVE. FREE2MOVE provides private, public, fleet sharing and smart services (pay parks and pay toll) while gathering all mobility providers in just one app (car2go, enjoy, Ofo, Mobike) as well.
A similar approach was shown by Andrea Badolati. He highlighted how the Blockbuster-to-Netflix effect affected his company: in 1980 they started as a corporate rental agency, then switched to private rental in 2010, and then introducing, just in 2015, Ricaricar, the first and still unique way to rent a car monthly, choosing from a selection of packages differentiated by services and prices. Time, finance and logistic troubles of having a car are erased. In a fast-moving, high-demanding market like this, where costs to final clients are basically a bit above the zero, the customer is really the king, and offers are based on personal, individual needs. But not only that, it has to be simple and user-friendly, simple, innovative, convenient - and, of course digitally driven.
How does this affect profitability?
Partnering and thinking unconventionally is the only way to be profitable. PSA is granting production of cars in order to survive, and building demand was the only way to keep making cars. And they have to make it good: << if we are able to give an experience to customers we have to make sure that it’s the best possible ever>> said Badolati << because getting out of the business is way easier than getting in. You have to provide top customer experience whilst at the same time to “spice things up” to keep your offer interesting and differentiated from the high competition pressure. >>
Tips for future managers?
Never prick your job based on how famous the company is, but how much it’s going to let you show your potential. Be open and have no boundaries, and will to always be learning. Ask questions and look up to your managers, because you have to absorb everything you are exposed to. << You belong to the world>> and be <<open to merging, both professionally but mostly, on a personal level.>>.
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Written by: Chiara Estini
Edited by: Priscilla Greggio