The auto industry is feeling the effects of profound disruption. Autonomous transportation, of course, has captured the attention of consumers and policy makers and within the industry. But there is other, less obvious evidence. For example, in America, the number of those aged 16-18 applying for a driver’s license has dropped sharply, signaling a stark change in consumer sentiments about vehicle ownership and operation.

Established automotive companies are already hedging bets by investing in new business models.  GM has invested $500M in Lyft and announced fractional ownership models. Product portfolios are shrinking. Ford in particular is discontinuing many sedan models. Other manufacturers are consolidating production lines in a quest for agility, cost-effectiveness and lean and green operations while aiming to offer consumers more choices around digitally enabled features and functions such as gesture control, voice commands and augmented reality.

Nearly all OEMs have development initiatives towards fully autonomous capability with features such as Nissan’s self-parking and enhanced cruise control. New collaborations such as SoftBank and GM raise the debate around consolidations and spin-up businesses. The big disruptors such as Alphabet and new entrants such as Dyson continue to push new boundaries and accelerate disruption, putting digital capability at the core of their investments and developments. Smart City and legislative changes all add to the complexity. The volume and velocity of data in massive ecosystems is clearly evident.

Established automotive brands face tough choices across their evolved value chain to infuse digital value and transform decades old operational systems and practice to compete in the future.

Change starts with client demand, experience expectations and consumption preferences. What follows is a tsunami of transformations from the dealership to the materials provider. No element of the operating model will be untouched and putting data and smart systems to work will be the key to success.

Hitachi is no stranger to digital disruption in the auto industry, having operated in the industry for over 50 years. We’re now one of the largest manufacturers outside the OEM themselves. Innovations such as our digital/connected drive train, autonomous driving features and advanced manufacturing capabilities feature strongly in helping automakers turn disruption into value. Today, Hitachi is leaning in with a range of solutions, OT experience, IT, IoT and Integration capabilities that can be leveraged to accelerate transformation Hitachi actively participates in a variety of key ecosystem areas such as Smart City, legislative transformation and industry standards definition. For a closer look at our innovations, find out more here.