Owning the future of mobility: Financial services at the heart of disruption

It has been – another – challenging year for automobility – EV regulation increasing, challenging economic environment, geopolitics with tariffs in different regions… creating more and more volatility for all market participants.

Players have to both manage the short-term (cost-cutting, digital efficiency, capability build-up also through partnerships, complying with regulations…) and the longer-term (having the right models with the right powertrains, transforming the distribution set-up…), which certainly continues to make it a demanding but also interesting time to be working in automobility!

The front-runners in EV like Tesla are starting to encounter “incumbent automotive challenges” (price levels, stocks, demand slump, residual values…), whilst the mainstream players are gradually ramping up their EV capabilities, strengthened by their ICE activity.

However, even with recent regulation adjustments in Europe, capability to specifically sell EVs remains key going towards 2030. This has a knock-on effect on the whole ecosystem, which needs to become capable of operating and monetizing an entire new value chain well beyond the first NC cycle of 3 years. Multi-cycle has been a critical topic of discussion and action for the past year, with players encountering massive challenges. 

For OEMs the focus is how to offer the right product mix at the right price as regulation develops, how to go beyond the first sale to generate margins consistently (multi-cycle for EVs, downstream optimization), how to partner rather than trying to do everything alone.

Besides heavy investments in time, effort and Euros to catch up with technology and cost leaders increasingly localized in China. For Banks / Captives, it means offering autofinance products that support customers and dealers in their transition (with ownership and increasingly usership), partnering with OEMs in order to be relevant and generate additional margin (lifetime value models). While reducing costs radically and complying with increasingly demanding (and unforeseeable) regulations. For Insurers, the challenge is to maintain affordable pricing despite a fundamentally different operating model, both facing the customer (where products are increasingly embedded in vehicle sales) and in claims despite a still emerging ecosystem (batteries…!). All this in addition to the “normal” challenge of making customer experience and back-office more digital & efficient.

In the report we document the incredibly rich presentations and exchanges in our webinars of this last year; from managing multicycle and the specific needs of EV, to the rise of new Chinese OEMs, to embracing technology efficiency with AI.

Our big Thanks go to everyone who has contributed to the community over the year and participated in our different events. We hope you find this report a useful and inspiring vision of the challenges that we need to collectively face!