Exploring the automotive transition: A technological and business model perspective

The automotive industry is currently undergoing a radical transition. This transition is a complex process that depends on many factors, especially technologies and business models. This process started many years ago, but it is still associated with a high uncertainty level. With regards to powertrain technologies, it is not clear which technology will be dominant in the future. Will it be the Battery Electric Vehicle (BEV) or the hydrogen-based Fuel Cell Electric Vehicle (FCEV) that will achieve a higher level of diffusion? Regarding business models, despite extensive research, the business models that will support the automotive transition are far from clear. Therefore, this research, based on a two-stage interview study, addresses both perspectives: technology and business model. Three possible options for powertrain technologies are identified: (i) coexistence of BEVs and FCEVs, (ii) BEVs, but conditional introduction of FCEVs, and (iii) BEVs only without FCEVs. In addition, the results show that business model innovation in the automotive industry can be driven by many aspects such as management vision, market, competition, future trends, battery, charging technology and infrastructure, as well as digital technologies and services. By combining the powertrain technology and business model dimensions, four future scenarios for the automotive transition are proposed: simply BEV, technology diversification, service oriented BEV production, and maximum versatility. An expert evaluation allows the scenarios to be prioritized according to their likelihood of occurrence. The results show that the service-based BEV-scenario is the most likely one. Nevertheless, the differences between most and least likely scenarios are not large enough to disclose a clear trend, confirming the diffuse situation in the industry.