May 16, 2020

Key manufacturing trends: what's driving the connected car?

3 min
Key manufacturing trends: what's driving the connected car?
2015 was a year where embedded technologies enabled manufactured products to be more “informed”. New stakeholders with innovative products a...

2015 was a year where embedded technologies enabled manufactured products to be more “informed”. New stakeholders with innovative products and services entered the ecosystem, traditional supply chains have been disrupted through new channel options, and, above all, customers demanded an ever-increasing level of customization; not just in products and services, but also across the entire procurement and product usage experience. Let’s take a look at one of the biggest trends in manufacturing for 2016 - automotive and the connected car:

1. Consumerisation: Consumers’ buying behaviour is changing and today, it is not just items such as clothes and electronics that are purchased online; often, the process of buying a car starts with online research. Buyers used to speak to dealers and then make their decision, whereas now, a lot of the background work is happening online before reaching the dealership. Car dealers have long been aware of this trend, and are working with car manufacturers to make the most of this trend. Some car manufactures have made creative use of augmented reality to establish virtual dealerships for potential car buyers to experience the ‘look-and-feel’ of the vehicle before purchase. As a result of the proliferation of consumer devices there is a step change in expectations in B2B environments as, ultimately, it is the user experience taking centre stage. This means that traditional B2B manufacturing companies will increasingly adopt a B2C approach towards their B2B customers.

2. Connected cars and infotainment: A study by McKinsey suggested that a rise in the number of connected cars will increase “the value of the global market for connectivity components and services to €170 billion by 2020”. For many, the car is now turning into an extension of the home, with drivers’ digital, social and mobile habits – underpinned by technology advances – being integrated into the vehicle. This trend is set to continue next year with car manufacturers keen to take advantage of monetisation opportunities around the connected car, not least by taking demographic tastes and needs into consideration, and applying these to the vehicles. Through the use of sensors, which deliver data for analysis, the connected car provides yet another opportunity to understand driver characteristics, their needs, the features they might appreciate, while introducing an additional layer of safety.

3. Robotics and automation: Automation has started to infiltrate a number of industry sectors - from banking and insurance to healthcare and manufacturing - to various degrees with increasing impact. In fact, a recent study by Cognizant found that roughly 50% of respondents see automation as significantly improving processes over the next few years.

As a result, automotive and vehicle manufacturers too have begun to make use of automation and automated process in a number of situations. For example through Advanced Driver Assistance Systems (ADAS), vehicle manufacturers are able to move to the next stage of autonomous driving and we will see an increase in the use of this technology. Secondly, there is vehicle-to-vehicle communication, another major enabler of autonomous driving. For example, if there is a traffic incident ahead, current navigation systems offer a diversion around the traffic incident. Thirdly, there are autonomous trucks which can provide relief to the driver during long-haul journeys and finally, autonomous drones will be increasingly used to inspect land and railways tracks and yard and inventory management.

These trends provide opportunities for organisations to rethink, reimagine and reinvent themselves and stay competitive by doing business more effectively and efficiently. Manufacturers must fully embrace social, mobile, analytics and cloud (SMAC) and sensor technologies to achieve the operational excellence, agility, innovation and customer centricity required to remain relevant with customers, business partners and the entire manufacturing ecosystem.

Prasad Satyavolu is the Head of Innovation, Manufacturing and Logistics at Cognizant


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Jun 8, 2021

IMF: Variants Can Still Hurt Manufacturing Recovery

Elise Leise
3 min
The International Monetary Fund (IMF) claims that while markets are rising and manufacturing is coming back, it’ll push for global immunisation

After a year of on-and-off manufacturing in the US, UK, and the eurozone, demand for goods surged early last week. Factories set growth records in April and May, suppliers started to recover, and US crude hit its highest price point since pre-COVID. As vaccination efforts immunise much of the US and UK populations, manufacturers are now able to fully ramp up their supply chains. In fact, GDP growth could approach double-digits by 2022

Now, the ISM productivity measure has surpassed the 50-point mark that separates industry expansion from contraction. Since U.S. president Biden passed his US$1.9tn stimulus package and the UK purchasing managers index (PMI) increased to 65.6, both sides of the Atlantic are facing a much-welcomed manufacturing recovery. 

Lingering Concerns Over COVID

Even as Spain, France, Italy, and Germany race to catch up, and mining companies pushed the FTSE 100 index of list shares to a monthly high of 7,129, some say that UK and US markets still suffer from a lack of confidence in raw material supplies. Yes, the Dow Jones has made up its 19,173-point crash of March 2020, and MSCI’s global stock index is at an all-time high. 

Yet manufacturers around the world realise that these wins will be short-lived until pandemic supply chain bottlenecks are solved. If we keep the status quo, consumers will pay the price. In April, inflation in Germany reached 2.4%, and across the EU’s 19 member countries, overall prices have increased at an unusual pace. Some ask: Is this true recovery? 

IMF: Current Boom Could Falter

Even as Elon Musk tweeted about chip shortages forcing Tesla to raise its prices, UK mining demand skyrocketed; housing markets lifted; and the pound sterling gained value. The International Monetary Fund (IMF), however, cautioned that manufacturing recovery won’t last long if COVID mutates into forms our vaccinations can’t touch. Kristalina Georgieva, Washington’s IMF director, noted that fewer than 1% of African citizens have been vaccinated: “Worldwide access to vaccines offers the best hope for stopping the coronavirus pandemic, saving lives, and securing a broad-based economic recovery”. 

Across the globe, manufacturing companies are keeping a watchful eye on new developments in the spread of COVID. Though US FDA officials don’t think we’ll have to “start at square one” with new vaccines, the March 2021 World Economic Outlook states that “high uncertainty” surrounds the projected 6% global growth. Continued manufacturing success will in large part depend on “the path of the pandemic, the effectiveness of policy support, and the evolution of financial conditions”. 

Mathias Cormann, secretary-general of the Organisation for Economic Co-Operation and Development (OECD) concurred—without global immunisation, the estimated economic boom expected by 2025 could go kaput. “We need to...pursue an all-out effort to reach the entire world population”, Australia’s finance minister added. US$50bn to end COVID across the world, they imply, is a small investment to restart our economies.

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