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AI will drive automotive future, says Audi SA head

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After the steam engine, assembly line production and automation in production, digitisation is having the biggest impact on the automotive industry, writes TREVOR HILL, Head of Audi South Africa.

As the “fourth industrial revolution” championed by the World Economic Forum’s Klaus Schwab gains momentum, it’s thrilling to anticipate what this means for the automotive industry – and as a result, cities of the future.

Schwab and the WEF link the emergence of breakthrough technologies such as artificial intelligence to a revolution in how business and society function together into the future. It makes sense. But, what this vision needs most, is for industries like ours to take the lead in translating theory into a tangible reality.

As with everything today, this happens within a context of constant change. The automotive industry is itself experiencing its own “fourth revolution”, and Audi is responding by transforming itself into an automotive brand that owns the future. Our focus is on driving progress as an innovator intentionally crossing the divide between a traditional model as motor vehicle manufacturer to being a hybrid business, where our vehicles enable superior mobility for goods and people in a more modern city.

Critical to this, is how we seamlessly integrate artificial intelligence across our product range. We know that the application of artificial intelligence opens up a new dimension of performance for vehicle products and that AI has an exponential impact on what we call the “mobility value chain”.

This means embracing the fact that future growth will no longer occur in the traditional car business, but instead it will shift to the usage of mobility products and services. Areas such as autonomous driving, new and sustainable drive concepts, mobility services and digitalisation of the car and vehicle environment are all examples of where our industry should be moving.

As a digital car company, Audi is digitising all processes: from product development with virtual reality, to the factory with intelligent robots and to sales with the latest digital technology. To enable this, we have expanded our business model to ensure that services appear alongside our products.

This by no means eliminates the need for automotive production and technology, but instead makes a giant leap forward in how traditional technologies play a greater part in society through the inclusion of AI.  With this in mind, we are focusing our business on developing alternative powertrains, integrated mobility solutions, autonomous driving technologies and a significantly greater level of connectivity that will help us better evolve the entire mobility value chain as soon as 2020.

Much of our focus is centered on the concept of the 25th hour. The 25th hour is built on the premise that in the future, self-driving cars will navigate fluently through the city – without a steering wheel, without a driver. Users will have free time. Free time that we at Audi call the “25th Hour” of the day.

Already, models such as the new A4 and new Q7 point the way ahead. Their online services, grouped together under the term Audi Connect, link them to the Internet, the infrastructure and to other vehicles. Their assistance systems operate predictively. For instance, they can alert the driver to a tight bend that comes just after the crest of a hill, or Traffic Jam Assist can take charge of the steering in slow-moving traffic on good roads, at a speed of up to 60 km/h. These technologies represent a pre-stage to piloted driving, which will be introduced in series production in 2017 with the next A8 generation.

Outside of what is included in the latest generation of luxury sedans, we are entering a time of swarm intelligence, where cars communicate with each other and with infrastructure, then use this information to plan optimum routes and speeds. A technology called Traffic Light Information (TLI) is already in place in Las Vegas, where it communicates with traffic lights and provides drivers with a “time to green light” countdown on the head-up vehicle display, telling them when the light is due to change.

Cars communicating with the infrastructure around them can also cut fuel consumption in urban traffic by up to 15 percent, as cars “surf the green wave”, adjusting their speed to ensure each traffic light turns green as they reach it.

The latest generation of mild-hybrid vehicles feature electrical systems that can coast with the engine switched off and the drivetrain decoupled, an extended start-stop mode and a high level of brake-energy recuperation. This is another step toward affordable, practical, fully electric vehicles

The buzzwords in automotive design these days are autonomy, intelligence and innovation. The vehicles of the future will continually learn and develop, while the technology adapts to people’s individual needs. Cars’ AI, or artificial intelligence will also suggest appropriate services and book them if desired by its passengers, like a concierge.

The latest software can also be downloaded as required, so you will be able to update your car in the same way you update your phone or your computer. From now on, your car can order functions on demand and always have the most up-to-the-minute capabilities – downloaded straight from the internet, as you need them.

The car of the future will be a car uniquely customised to client needs. It will be constantly learning, updating its knowledge and fine-tuning the user experience to suit the driver’s preferences. Your car can create working conditions that are even more pleasant and productive than in the office.

Piloted parking is another revolutionary innovation already available in the cars of today, such as the new Audi A8. You no longer even need to be seated in your vehicle while you park – your car does it all for you, more accurately and requiring less parking space.

This has further implications for urban design, as the space required for parking areas can be reduced. Indeed, the very idea of mobility is changing. Even the principle that you need to own a single personal vehicle to be mobile is being questioned.

Car companies are offering mobility solutions that allow you to pick up a car when required, or to change the model of car you drive several times during a year. Thanks to advancements in automation, innovation and artificial intelligence, motoring and mobility is about to change permanently. How we get around has always been part of what defines us humans, and we are about to take a quantum leap into an exciting new phase of our existence.

It’s quite a time to be alive.

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Are you playing auto roulette with smart car devices?

Kaspersky analysed aftermarket connected smart car devices, and made a pleasant discovery

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There are currently two ways for car enthusiasts to obtain a connected vehicle – purchase a ‘smart by design’ car from a dealer, or improve their existing car with a number of additional ‘smart-devices’. While both scenarios create a greater driving experience, smart technology also represents a brand new area for malicious use, as the media and Kaspersky’s own research has repeatedly shown. This is inevitable – when a piece of technology becomes essential, related security issues tend to increase.

With this in mind, Kaspersky researchers set out to discover whether these reports on the security of IoT devices had any impact on manufacturers of smart devices for the automotive industry. The researchers analysed several randomly selected devices, including an OBD dongle scanning tool, a tyre pressure and temperature monitoring system, a smart alarm system, a GPS tracker, and an app-controlled dashcam.

The findings were a pleasant surprise: while the IoT industry has often been considered vulnerable, these automotive-related smart and connected devices proved to be quite secure, with no major vulnerabilities exposed. However, several security issues were also revealed: the ability to remotely access driving dynamics data via a scanning toll, the option to manipulate signals from the tire monitoring system, and, most alarmingly, the ability to open vehicle doors using the alarm system. However, all of these elements are either very hard to implement or bring no obvious or immediate outcome for a criminal.

“The devices we examined met many security policies and were satisfactory, with the exception of a few small issues. This is partly due to the limited functionality of these devices and the lack of serious consequences in the event of a successful attack through these products – but also thanks to the vigilance of manufacturers. We were glad to see that they have invested their efforts into making these devices more secure, a good sign overall for the automotive industry. Yet, this is still not a reason to relax: based on our experience, the smarter the device, the higher the chances that security issues will occur. That is why security should be considered more closely in the early stages of product development, especially as a new generation of smart devices come to the market,” notes Victor Chebyshev, security expert at Kaspersky.

To keep smart automotive devices even more secure, we advise:

  1. When choosing which part of your vehicle you’re going to make a little bit smarter, first consider the security risks. Think twice if the device has something to do with the car telemetry or access to its ‘brains’.
  2. Before buying a device, search the internet for news of any vulnerabilities. It is likely that the device you are going to purchase has already been examined by security researchers and it is possible to find out whether any issues have been found in the device, or have already been patched.
  3. It is not always a great idea to buy the most recent products released on the market. Along with the standard bugs often found in new products, recently-launched devices might contain security issues that haven’t yet been discovered by security researchers. The best choice is to buy products that have already been worked on with several software updates.
  4. Always consider the security of the ‘mobile dimension’ of the device, especially if you have Android devices – applications are often helpful and make life easier, but once a smartphone is hit by malware, a lot can go wrong.
  5. To overcome the challenge of smart device cybersecurity, Kaspersky has invested in Kaspersky OS, widely used in customised manufacturing hardware and software. This system can be used across a variety of fields: on mobile devices and PCs, IOT devices, intelligent energy systems, industrial systems, telecommunications, and transportation systems. Kaspersky sees opportunities in the further development of KasperskyOS to meet the needs of our customers and ensure the highest levels of security can be achieved in all these fields, including the automotive industry. More information can be found here.

Read the full text of the report on Securelist.

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How car-buying must change

The car-buying experience must innovate to evolve the automotive industry, writes TREVOR HILL, head of Audi South Africa

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Our relationship with motor vehicles is a complex mix of emotional and rational decision making. Add to this, external influences such as longer product-retention cycles (up from five years to as much as seven years), a struggling economy and probably the greatest product choice in the market we have ever seen; there is a significant need for manufacturers to reinvent the car-buying experience.

So, while the “future of mobility” is evolving to enable new technologies such as autonomous vehicles, connectivity, electrification and shared mobility – it is necessary that there be a proportional shift in how we can innovate how these products are purchased or considered at the onset.

This trend is not new. As early as 2013, global consulting firm McKinsey published a report highlighting three key trends that would impact customer decisions and engagement on the retail end of the automotive industry. These included: an enhanced level of what it called “touchpoint management”, sales and service upgrades and the role of the traditional Dealership in the customer purchase and sales decision journey.

Fast forward to 2019. The challenge for automotive brands is how to deliver a personalised, digital service in an industry once solely reliant on bricks-and-mortar Dealerships and a hard-sell sales approach. In the premium segment, there is even more room for innovation around the Dealership experience to meet the demands of personalisation and technology while still delivering on fundamentals. This includes aspects like physically experiencing the vehicle before purchase, expert product advice and the personal customer experience that enhances long-term brand experience and loyalty.

Behaviour-driven thinking dictates how we reframe and design the customer experience of the future. As an automaker in the premium segment, we focus on three key principles of behavioural planning:

  1. The paradox of choice: Offering customers more choices is not always better, as we can trigger an unintended “paralysis of choice”. When we have too many options, the likelihood that we will make a decision is reduced. Given this, Audi has reviewed our options specification for new products entering our model range and will be developing specific packages around various customer needs. This allows for reduced complexity of choice and ease of ordering a new vehicle. This will be reflected on our digital platforms when configuring any of the new vehicles such as the Audi Q8 and upcoming Audi A1 and Q3. This simplification is the first step towards addressing how customers experience us as a brand.
  • Availability: Creating opportunities for customers to assess choices through innovative and digital examples is a foundation of how we are slowly reinventing our Dealership experience. We are pioneering this by introducing the Customer Private Lounge (CPL) – one of a kind in South Africa and located at Audi Centre Centurion in Pretoria – that allows customers to build up their Audi using digital configuration and virtual-reality technology.
  • Relativity: Customers are more likely to make decisions based on the context. While traditional Dealerships will remain key to the customer’s sales journey, Audi aims to connect new opportunities within this environment. This includes a combination of traditional selling (knowledgeable consultant, premium environment) and digitalisation (customisation, low need to carry extensive showroom stock). 

The launch of the Audi Customer Private Lounge is the foundation of this latter effort. A recent Bain survey found that even web-savvy modern car buyers’ still make an average of 2.4 Dealer visits before making a purchase decision – underlining the critical importance of combining a relevant and unique Dealer retail experience when finalising a sale.

Another foundation of our retail experience effort effort is a 4000m2 Audi and Volkswagen Training Academy in Centurion, custom designed to continuously improve Dealer performance through training and skills development. Added to this is Audi’s global and digital initiative towards training – Audi Training Online. This is an online platform offering convenient learning for all Audi dealership employees around the world. Employees can access the portal at any time, from any location and easily upskill themselves on brand related topics, products, technologies and job related (technical and non-technical) subjects. Given the increasing technical complexity of our vehicles and new business and brand themes, a high level of knowledge and expertise is critical to ensure optimal customer satisfaction.

The evolution of training and customer experience is the first, necessary step to respond to today’s car-buying customers’ demand for a unique retail environment. As an industry, we need to respond to this opportunity sooner rather than later. This response must deliberately address the customer experience journey from information, to contact, to purchase, handover and to aftersales. This requires interventions in terms of personalisation, how we introduce opportunities for customers to be in control while still receiving expert guidance.

A more digital retail platform gives us a significant opportunity to better serve our customers through this journey. In the case of the CPL, a dedicated consultant, specially trained, takes the customer through the process of selecting the customised specification on their virtual-reality Audi, before they even encounter a salesperson. The CPL represents the first leg of Audi SA’s digitisation strategy. It’s progress in the retail realm, and a game changer for the automotive industry.

In future, automotive retail will require many new functions and roles to meet the demands of an omnichannel sales model. Building these new capabilities is a fascinating process, bringing in new skill and fundamentally refreshing the industry to benefit the most important stakeholder – the customer.

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