BMW and semi-autonomous cars – DTP group 15
Bayerische Motoren Werke Aktiengesellschaft (BMW AG) was founded in 1917 and is based in Munich, Germany. The company manufactures automobiles, engines and motorcycles. It operates in the automotive industry, which was created in the early 1900s. The automotive industry is a collective of all the companies that design, develop, manufacture and/or sell motor vehicles. BMW has emerged as one of the most successful automobile companies worldwide. It focuses on the luxury and exclusive car market. For this segment, BMW strives to offer premium cars that provide services that go beyond necessary features.
Currently, BMW focuses on strong brand recognition, with high standards for quality and technology. This stems from the company mission: being the world’s leading provider of premium products and premium service for individual mobility (BMWgroup, 2014). The company has a global focus, just like most of the competitors on this specific market segment. Furthermore, it uses a differentiation strategy to distinguish itself by offering high quality materials and premium services.
The automotive industry was strongly affected by the financial crisis, but since 2010 sales have been on the rise again. BMW is also influenced by other factors from its macro environment: tighter CO2 emission restrictions influence the car design and BMW now also pursues alternatives to conventional cars, e.g. Hybrid vehicles; increasing petroleum and other raw material prices; fluctuating exchange rates; changing customer demographics and other technological advances in the car industry (‘connectivity’).
In the future BMW will strive for a larger, broader product portfolio and expansion, which it intends to achieve by focusing highly on innovation and strong technological developments. Furthermore, in their long-term energy strategy, BMW focuses on fuel-efficiency to improve its products image in that regard. Concerning its IT strategy, IT already plays an important part, namely, during the manufacturing process and within the vehicles themselves (software for board computers). Being innovative in IT remains to be a focus of BMW’s strategy.
The disruptive technology that BMW should consider implementing is semi-autonomous cars. These cars can sense their surroundings and navigate through it with minimal human intervention. Fully autonomous cars will not be released until a decade from now on, hence, we will focus on semi-autonomous instead as they face less challenges. So far, many leading car manufactures and new entrants (Google) have intensified their endeavors to make semi-autonomous become a reality within the upcoming years. We would advise BMW to incrementally implement semi-autonomous features into its existing cars, instead of waiting 6 more years before launching a new semi-autonomous car product line. This would enable them to recover costs earlier, gain experience under realistic conditions, meet governmental and legal requirements, as well as, gauging customer reaction. BMW will not be among the first-movers to introduce semi-autonomous cars, however, it can learn from the challenges that those will face. By the time, it introduces its own semi-autonomous vehicle, it could highly benefit from the technical, operational and economic experience it gained by introducing it incrementally in other car models.
Even though, the dimensions of the future (semi)autonomous car market are still hard to grasp, based on the car makers efforts and advances in technology, it is for sure that these cars will be on our streets within 10 years. Semi-autonomous cars are just a stepping stone towards a future that will alter how we will perceive and experience driving.