“MOBILITY IS PART OF OUR DNA”
PETER SCHWARZENBAUER, a member of the BMW Group’s management board, on the future of mobility.
First, let’s start with a quote from over 100 years ago: “Automobiles are a passing phenomenon,” said the German Emperor, Wilhelm II. “I believe in horses.” Today, you have to admit that maybe the Kaiser, who was greatly interested in technology, was right from a long-term perspective, and the personal automobile is a passing phenomenon.
You could, of course, accuse me of practicing a calculated optimism, but I'm seeing the exact opposite. Nowhere in the world are individual mobility needs on the decline, and, measured in terms of miles per person, they're actually increasing. I think the desire for the freedom to be able to go from point A to point B is part of our DNA. And until the day that transporter technology is a reality, we will need hardware to get around.
In addition, autonomous driving represents the next great revolution in mobility.
Revolution? Is the impact of autonomous driving r really comparable with the advent of the railroads?
Absolutely. It will allow us to organize transportation in completely new ways. Imagine a large city with no traffic lights or traffic signs, no cars parked on the side of the road. And most importantly, one with no traffic jams. The number of traffic accidents will also decline dramatically. It will entirely change our quality of life and make our cities much more livable. Mobility options will be available throughout the city, and society as a whole will benefit substantially.
You talk about the benefits for society, but millions of people around the world earn their livings driving trucks, buses and taxis. How would you explain to these people that it is better for a computer to drive their vehicle?
You can't view these developments in black and white. New mobility options like autonomous driving will exist alongside current models. I believe that in the long term such changes usually present more opportunities than risks.
Autonomous driving will further boost the sharing economy. People P will use cars as individuals, but they won’t necessarily have to own one. That doesn’t trouble you?
No, we recognized this trend early on, and we established our own carsharing service seven years ago that now has more than one million members. Of course, our primary goal is to sell cars, but we will also play an important role in the overall individual mobility chain of our customers – well beyond personal vehicles. We are now the world's largest provider of innovative digital parking services, and we have the largest network of charging stations in the world. We want to address all of the mobility-related pain points our customers feel and to provide an optimal, individualized mobility offering.
Sometimes it feels like the world has start-up fever. BMW has invested 500 million euros in a venture capital fund. No other carmaker has made as many y start-up deals. Why W are you so intent on this external path to innovation?
The car industry is undergoing a significant transformation. The range of topics we now deal with goes well beyond the automotive industry. Start-ups are often used here as an accelerator, especially due to their completely different mind-set. They are accustomed to thinking in quick product cycles, and they tackle issues very differently than a large corporate group does. We have now made about 30 investments, but we looked at well over 1,000 start-ups. But young companies also benefit from our experience and our network as an established, global player. So it's a win-win situation.
In addition to autonomous driving, g, electrifielectrifififification is the other big trend in the industry. But the German automotive industry is often accused of having missed the “Tesla revolution,” just as Kodak missed the revolution in digital photography. How do you respond to that?
I can only speak for us, and at the BMW Group it was clear early on that electric cars could be a solution for megacities, where mobility must be as emission-free as possible. That's why we brought the BMW i3 to market in 2013, soon followed by the BMW i8. We have developed completely new vehicle concepts, and certainly this was one of the boldest decisions ever made in the automotive industry. I think we've done some pioneering things here.
Most major manufacturers now say the future of auto-mobility will plug in to a wall. But electric vehicles sales still account for a low single-digit percentage of overall sales. Why?
In retrospect, it always seems like new technologies like the internet or the radio appeared overnight – but that's not the case. When the telephone was introduced to the market, it took 35 years for just 25 percent of the US population to use one. And don't forget that a car is the second biggest investment a family will make, only following buying a home.
Shouldn’t you invest in electric cars?
Oh yes, of course. But we all grew up with combustion engines. We are familiar with them, and we feel confident with them. With electric engines, many people are still not sure if things are going to pan out. The discussion about range comes up time and again, although most people don't actually drive very far – this is more of a psychological issue. In addition, the network of electric charging stations is still not extensive enough. Working together with cities like Hamburg, we hope to promote electric mobility by adding a larger number of BMW i3s to our Drivenow fleet while simultaneously expanding the number of charging stations.
Let’s turn to the next megatrend: How will ll digitalization a affect cars?
Car manufacturing processes are becoming more digital and more automated – as is the case in many other industries. In addition, digitalization will enable us to have more direct contact with customers. Over the last 100 years, our strategy has relied on large-scale advertisements to attract attention. The digital world allows for a much more focused sales approach. Digitalization enables us to integrate cars more into the digital lives of our customers. They become “smart cars.”
As part of the ongoing digitalization process, automobile manufacturers seem to have discovered the CES consumer electronics show in Las Vegas, where the DVD, Tetris and the Xbox were all unveiled. New car models are now introduced there as well. Why?
We are very much inspired by the gaming industry in particular. What do millennials like in video games, and what don't they like? We try to translate these preferences into our world. You can already experience the new X2 entirely virtually. There are also potential applications in the car's controls and interface.
Next trend: The e growth of the middle class in emerging markets?
For a premium manufacturer like the BMW Group, this is obviously a huge opportunity. In connection with the aforementioned technologies, I am very curious to see whether there will be a leapfrog effect, as was the case with mobile phones, where certain countries previously had no landlines, but instead transitioned directly to mobile technology. In the same way, I could imagine certain emerging markets adapting to autonomous driving more quickly than industrialized countries.
Finally, a look ahead: If we meet again in four years, which mobility trends will we be talking about?
Passenger drones are looming on the horizon. Transporter technology probably still needs a little more time.
Passenger drones are looming on the horizon.