Global Automotive Executive Survey 2017

Conclusion: Prospects of success 53
From product profitability to customer value
KPMG Viewpoint
Customer value
= revenue potential
• The traditional hardware-related business
model of the automotive industry will be
put under pressure from two sides:
Taking end to end
investment & +x
business case
calculation into
consideration
t -1
Source: KPMG Automotive Institute 2017
-x
Scenario 1:
Traditional vehicle sales
Scenario 2:
Subsidization of hardware
+
+
+
+
Leaps in revenues with new customer
lifecycle oriented business models which
focus on data and service
Falling trend
because of
tech-shift
In a completely optimized data- & servicedriven
business model of the future, the
hardware may be given to the end customer
free of charge. This might not be applicable
for premium OEMs because their brands
always reflect a certain value for the
customer.
Reason: The data & service related revenue
potential could be by far higher than in the
traditional hardware oriented business model
("Nespresso business model")
-
B2B
B2C
B2C
B2C
B2C
Data- & service-driven
Vehicle-independent
& usage-dependent
business models
Vehicle- & productoriented
business
models
Hardware-related
business models
time
= Customer lifecycle
≠ hardware lifecycle
Technological change of the
product ‘car’ by electrification
and (full) autonomization will
inevitably lead to a reduction in
traditional revenue potentials
(e.g. lower aftersales revenues
regarding wear and tear
components)
• Mind-shift: major change in customer
behavior in the age of digitalization
• Tech-shift: major change of the product
‘car’ by electrification and (full)
autonomization
• The business model and the underlying
profitability analysis needs to focus on the
customer lifecycle instead of on the product
lifecycle
• This basically requires differentiation
between two customer groups:
• B2C: When calculating end-customer
value, the revenue potential in the form
of disposable income will be central.
The revenue potential will depend on the
relevant living conditions (city/country)
and personal customer preferences in
allocating disposable income across all
expenditure on mobility, insurance,
shopping, etc.
• B2B: Customer value and revenue potential
of the commercial B2B customer/
partner will depend on the end-customer- /
data quality and the intelligent linkage of
various up- and downstream data (e.g.
further sale of data to insurance or
transportation companies).
kpmg.com/GAES2017
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