For many years, the high-end segment in global car market had always been dominated by Mercedes-Benz, BMW, Audi, and Lexus. The product lineup strategy of these four brands is quite similar, and featuring like this… portfolios are well-organized from small to large models, multiple body size variations, various options of powertrains, sporty sub-brands, and wide price ranges (from the price of high-end models of mass-market brands to the price of entry models of premium brands). As the diversified living needs or different demands in each stage of lives must be satisfied, so the high-end brands’ portfolio should be the most complex one of all car brands including mass-market brands! However, these are just the descriptions about the status quo in the era of ICE cars, then how about the new era of BEVs in the upcoming 2~3 years while massive amount of BEVs come to the market? If we take smart cockpit, autonomous driving, AR, interactive tech of driving environment, and the customizable production platform into consideration ( that will begin mass production in the upcoming 10 years ), will the high-end market segment still be dominated by these 4 brands?
Let’s first take a look at the two major key technology territories of the automotive industry in the next 5 years, the capability of the software development and battery performance of BEVs nowadays… Apart from VAG’s Audi and Toyota’s Lexus that own strong in-house software development units of the group, battery technology and the software development of the other two brands mostly rely on the cooperation or investment on IT companies; When the core technology must be completed by other companies, the competitor situations in the future will be more difficult to evaluate and control. In these technology territories, Tesla and BYD are the two carmakers with the solid foundation and foresights by now. The product lineup and price range of these two brands are not positioned in the high-end segment at the moment, but in the future it is highly possible for them to challenge the main price range of high-end brands (about the NT$ 3 mil. price range in Taiwan market) with their leading technologies ; moreover, to view from the wide-range product lineup, BYD has more potential to cover wider price range to shoot for bigger sales volume. Certainly, when moving toward high-end market, BYD has to gradually phase out the current entry models, or it will cause consumers’ confusion of brand recognition that makes it harder to enter the high-priced car market.
Furthermore, to view the high-end technologies of AI and ICT industry including autonomous driving technology and the interaction of driving environment… Most of the strong competitors in this territory are not traditional carmakers, so that will incur more uncertainties in the competition of the segment of high-end brands in the future, and even the company with potent BEV technology such as Tesla can’t have distinct advantage in this territory. When the car market comes to this phase (about 2030), I predict that new high-end brands will emerge and deliver solid sales performance in the future. Because the business model of the automotive industry in the future had already begun changing gradually… The role of retailers has been weakened, the importance of the online contact between carmakers and consumers had increased gradually, the individual demand from consumers can be feedbacked to the supply chain and the whole vehicle production line, so traditional high-end brands that enjoy the advantages of dealer channels (hardware infrastructure, quality of service personnel, on-hand stock for speedy delivery ) will no longer monopolize the changing info of market demands by that. On the other hand, the brands with advanced automotive technologies can realize “overtaking on curves” to meet high-end consumers’ needs by providing new technology. These new brands might not be the business entities based on carmaker, but they might be the spun-off companies from IT giants that master key technologies, and utilize the OEM model with carmakers just like Apple’s iPhone business model. As for who will emerge to be the new brand? I assumed that any IT giants with enormous resources and positive attitudes would be… Such as Google, Apple, Baidu, Nvidia, Qualcomm, etc.,
Although there are many brands in the car market, the main high-end brands widely recognized by the public are just a few. Certainly, the carmakers regarded as “high-end” won’t satisfy these high-end clients just by automotive technologies; However, in the moment that the rules for hundred years of traditional industry had been broken by the upcoming era of BEVs, the cognition of new generation consumers about the product value is changing simultaneously… Who can say that there won’t be new high-end brands to emerge in the next 10~20 years, as the mainstream consumers of high-end brands from the 50’s ~ 70’s generations changed to 80’s and 90’s generations?