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Covisint Study: Auto Industry Reaching "Tipping Point Of Demand" For Connected Vehicle Technology

Stocks in this article: CPWR

DETROIT, June 6, 2013 (GLOBE NEWSWIRE) -- Covisint, a Compuware (Nasdaq:CPWR) company, today announced the availability of a whitepaper it commissioned outlining keys to automakers' future success. This success, the whitepaper notes, is predicated upon how successfully automakers (often called original equipment manufacturers, or OEMs), incorporate technology not only into "smart vehicles," but also into the "digital lifestyles" of their customers.

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This research, titled " Your Customer is Connected -- Are You? ," highlighted the following core points:

  • It's becoming an owner-centric world. Consumers, although optimistic about future technology, nonetheless demand value and results that likely will shift industry attitudes in a way that places the owner, not the vehicle, at the center of the digital equation.
  • Relationships are transforming. In the past, manufacturers only had direct engagement with car owners for about 10 hours of the typical 1,460-day ownership period--less than 3/100 of one percent of the time. Now, through owner-centric technology, OEMs can have a lucrative and ongoing stream of engagement and revenue opportunities benefiting both during the entire ownership period.
  • Data continues to explode, multiply. As the sheer amount of data continues to expand, an independent interoperability platform like Covisint's will increasingly become critical to successfully integrating and delivering value-added services from multiple sources.

"The automotive industry is reaching a 'tipping point of demand' for user-centric connected vehicle services delivered via the cloud," said study co-author and CEO/Founder of CGS Advisors, Gregg Garrett. "Expectations are increasingly being shaped by the connected environment outside of the vehicle, and this fundamental shift is making it 'change or die' time for some OEMs. One facet of success likely will hinge upon how well automakers integrate their services into vehicles, across their brand and ultimately into their consumers' connected lives."

Traditionally, OEMs placed the end-product of the car at the center, focusing primarily on styling, powertrains, performance and value. Although those things will still be important, that traditional mindset is undergoing a rapid transformation and disruption. In the future, the whitepaper noted, OEMs who succeed will need to deliver a comprehensive, connected ownership experience for consumers across web properties, mobile devices and within the vehicle. Connectivity, it was noted, can no longer be viewed as "just another feature of the vehicle;" rather, connectivity will be seen as a key purchase differentiator with the car itself being perceived as just another node in the owner's digital life.

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