Cars aren’t likely to disappear any time soon. It is estimated that worldwide just over one billion cars are on the roads right now. The way we use them, however, is changing and the automotive industry is racing to keep up with this change.
Although global sales of plug-in vehicles are forecast to comprise only about 2% of global new car sales for the year 2018, and EVs make up only 0.2% of all light-duty passenger vehicles on the world’s roads today, the market continues to grow and major carmakers are increasingly committing assets and production capacity to the manufacture of EVs.
Ride sharing companies suggests occasional, low-cost access to shared cars is becoming more desirable than having an expensive, shiny new vehicle depreciating on your driveway.
Volvo Cars says its newly launched brand, simply called ‘M’, will expand its global mobility operations by providing dependable, on-demand access to cars and services through an intuitive app. ‘M’ will personalize the customer relationship by learning about its user’s needs, preferences and habits. Debuting in Sweden in the 3rd quarter of 2019, ‘M’ is a wholly owned, standalone entity within Volvo Car Group that aims to deliver a better alternative to car ownership for urban and metro consumers.
M’s proprietary technology platform will advance a new generation of consumer mobility services that provide a more intuitive user experience. The new brand draws on two decades of data and experience from pioneering car-sharing service Sunfleet. President and CEO Håkan Samuelsson says Volvo Cars is becoming more than just a car company.
“We recognize that urban consumers are rethinking traditional car ownership.,” he says in a statement. “M is part of our answer. We are evolving to become a direct-to-consumer services provider under our new mission ‘Freedom to Move’.”
So does this pose an existential threat to car manufacturers, businesses which spent more than a century profiting from car ownership as one of the ultimate symbols of freedom and success? But for some manufacturers this means a wholesale shakeup of the very nature of their operations. They still deal in steel and glass, dashboards and tyres; the making and selling of solid, physical products.
However, to compete with firms like Grab and Mycar, they are also entering the far less tangible world of “mobility services”, which encompasses everything from electric scooter hire to car-sharing apps. Car-sharing may become the dominant mode of urban car use, but it is yet to become a compelling business proposition in rural areas. This represents another area of opportunity for car manufacturers. They may be rebranding themselves as smartphone-driven service providers, but there is a more traditional role they can fill as providers of the next generation of electric cars to both individuals and the service industry.
