Jump to content
Create New...

European carmakers struggle to deliver...


Recommended Posts

Link: http://www.autoweek.com/news.cms?newsId=103083

European carmakers struggle to deliver pan-European in-car telematics
TIM MORAN | Automotive News
Posted Date: 9/2/05

Automakers in Europe once harbored high hopes they could earn a fortune by turning the car into an intelligent, rolling communications center. But those dreams have not materialized. No car manufacturer has figured out how to make a profit from telematics.

The lack of European communications standards, multiple languages and the failure of the industry to agree on a definition for telematics don't help. Ambitious systems such as General Motors' OnStar wireless communications network have not taken hold in Europe.

Modest goals

Now the telematics business is retrenching. This time, the goals are more modest.

"Many of the OEMs in Europe bit off more than they could chew in the early days. Most of those have retreated, gone away or have been reduced to something more manageable," says Phil Magney, principal analyst with Telematics Research Group Europe of Sindelfingen, Germany.

As an example, Magney points to DaimlerChrysler's decisions to end new subscriptions to its TeleAID call center-based services and to stop a project for an in-car portal that would share vehicle data using personal digital assistants.

Matthias Brock, a Mercedes-Benz spokesman, says the company remains committed to integrating consumer electronics such as mobile phones into vehicles using wireless connections. While navigation systems integrated with telephones and in-car sound systems are a must-have part of luxury cars, he says, Mercedes will focus on standardized rather than proprietary solutions.

"We will only implement mature technologies in our cars that provide a direct benefit for our customers," Brock says. Mercedes believes future applications will be more influenced by consumer electronics and less car-specific.

The factors faced by Mercedes are those that cloud the immediate future for true telematics, which means turning the car into a communications center that sends and receives information from many sources.

Companies such as BMW AG and Volvo remain committed to providing monitored telematics services through telematics service providers such as ATX Europe and WirelessConnect.

Those services require huge commitment, and the automakers use them to enhance their brands, offering such services as live traffic updates with routing information for drivers. BMW collects data from its subscribers to analyze traffic patterns.

Missing link

Such data collection may be the holy grail for telematics as it moves from luxury brands to volume brands, says Steve Millstein, president of ATX Technologies in Dallas.

ATX, whose European unit is in Duesseldorf, Germany, provides telematics services to BMW and has signed telematics service provider deals with Renault and Citroen. ATX Europe intends to be a pan-European player.

"To this day I don't believe there's really a credible provider of a pan-European solution," Millstein says. "And the reason is the automakers came from wanting to make money as a feeder to their core business in their core country."

Telematics consultant Michael Sena of Michael L. Sena Consulting AB in Sweden says true telematics offerings are really about two-way communication that makes the car itself an active part of a data network.

"All those cars driving around unconnected are driving around as they did 100 years ago," he says.

Sena has done significant work for Volvo since 1996. He says Volvo's quiet but persistent efforts to set up call centers has made it a pan-European provider to a new generation of connected vehicles.

A call-center-based telematics system can change the way people drive. That capability ought to make automakers realize they must support the technology as an essential feature of the car rather than as a separate revenue-generating feature, Sena says.

The value could come to automakers when they are able to debug faulty software on a new platform without resorting to a general recall.

"Any car company that gets involved in telematics because it's going to earn money in telematics today is thinking about it completely incorrectly," Sena says.

Afraid to be first

Increasing governmental and business requirements seem to dictate that, over time, telematics must be more than a glorified telephone with a navigation system.

In the United Kingdom, for instance, insurer Norwich Union has begun studying an e-pay-as-you-drive scheme with IBM Corp. and mobile phone company Orange.

IBM is providing telematics systems that deliver data via Orange phone service that could be used by Norwich Union to set rates based on an individual's driving.

Although Europe benefits from having a single pan-European global satellite for mobile communications telephone technology standard, it suffers from vastly different requirements for such things as emergency calls.

Meeting such requirements means creating a system that has the flexibility to give the right information in the right form no matter the location.

'Everything is different'

"We're still struggling with differences in the telecom industry here in Europe country by country," Sena says. "Everything is different; everything has to be tested 43 times. We have different services, different SOS laws."

Manufacturers have become hesitant about investing in pan-European services because they don't know whether they'll get their investment back. "No one wants to be first with something new unless they are almost certain that their competitors will follow shortly after," Sena says.

He says a high priority for automakers should be connecting vehicles to their information infrastructure. Older customers may tolerate driving to their dealership to connect to the carmaker's private and proprietary network to perform a simple software upgrade, as is the case today. But younger, more computer-savvy buyers will see this as awkward and unnecessary.

Says Sena: "The first company to understand this and implement it will definitely, if only briefly, have a competitive advantage."

Edited by VarianceJ30
Link to comment
Share on other sites

It's a good idea for Mercedes to back away from trying to innovate in the electronics, since they've been drowning in the bottom of the quality ratings pool. I think the brand-new stuff is better tried on the cheaper brands, where if it doesn't work, those types of cars are usually throwaway anyway....
Link to comment
Share on other sites

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

This is the Call To Action(CTA)

  • Create New...

Write what you are looking for and press enter or click the search icon to begin your search