Digital Transformation Part 2: It’s Smart City 2030


 In Brief

Car vending machines, a microcosm of a larger self-driving ecosystem brought to life on the heels of the IoT, is an example of a host of innovative business models that emerged to shape the new sharing economy itself. 4IR will see collaborative platforms that meet customer needs on an entirely different level attract waves of digital operators that embrace and manage change, the same way. Given technological advancement in the age of such acceleration, we are about to see mobility ecosystems of the future unfold before our eyes, today. Keep an eye on the Rinspeed Snap modular electric vehicle, for one, that caters to both top security of the passenger pod and feasible recycle-ability of the skateboard-like propeling components. It holds the promise as a key player in Smart City 2030  


In a previous article, we talked about digital transformation and the effect on the automotive industry (go to article click here!!). Paybacks range from digital sources, connected supply chain, predictive maintenance, mobility-as-a-service (MaaS), data security and protection, 5G and autonomous driving, topped off with IoT-enabled capacities, e.g., cloud computing, AI, machine learning, and big data and analytics, resulting in entirely different operating ecosystems and therefore business models.

The Prius and Nissan Leaf jump started the journey late 20th century. Clean energy, battery capacity and fuel-cell technology advancement will change the way we live for good, particularly through our transportation and habitation, namely vai car sharing, automation, electrification and energy storage-rechargeability. Autonomous technology will transpire mobility ecosystems not only through transportation but in the movement of assets, either hardware and software based on networks of processes and services that streamline physical and digital capacities into autonomous building blocks.

Last December, 2017, Ford Motor Co. announced a plan to sell 15 electric vehicles and plug-in gasoline-electric hybrid models in China by 2025 to become a regional leading manufacturer of electric vehicles. It also announced a plan to partner with Alibaba, the Chinese e-commerce giant to focus on reaching target market segments  through direct sales. When it comes to Chinese shoppers, Alibaba’s Taobao and T-Mall does know a thing or two. Alibaba’s $2.9 billion investment in Sun Art Retail, a top hypermarket chain in China, was to connect on and offline retail. Now it has an eye on the automotive business, the one remaining capacity that eludes Amazon and outsourced to third party vendors or handled through its uber-like application that matches idle drivers with a bored car to on-demand transport gigs. Although customers still want to see, touch and try the actual product before owning it, searching and shopping online is still a lot more convenient than shopping through traffic and hauling the cargo home. A light bulb went off in Alibaba’s top floor to get the best of both worlds: online auto sales and bricks and mortar Car Vending Machine (CVM).

In case your gripping over vending dimensions, CVMs are huge. One of the two planned looks like a Toys “R” Us headquarter straight out of a Marvel sci-fi comic book. The convenience that comes with is futuristic as well. Customers simply go through the same Taobao app, take a picture of the car they have a yen for, verify personal profile, state the color of choice and upload it. The app replies with queue options to schedule a driving test. Customers then travel to the CVM that has no employee to talk to and verify their ID through facial recognition from the app and get behind the wheel for a test drive.

Customers can test drive any available car for 3 days, and make a purchase through the app should they wish to do so or opt to try other models before deciding on something or not. Initially, one CVM will be in Shanghai and another in Nanjing. A total of 12 is planned to follow in 2018. The idea is to make auto sales as easy as grabbing a soda. Although damage and deterioration expenses can be disconcerting, Alibaba is marching forward based on a principle of trust and customer empowerment. Good customers will be able to not only retain better services but also receive positive credit scores and become a super member with a host of special privileges that Prime members begrudge, i.e., supposedly a more entertaining standard of living.

Alibaba’s CVM concept is nothing new. Autobahn Motors launched the world’s first largest luxury CVM in Singapore, in December of 2017. A 15-storey high-end auto dispenser with over 60 units of, e.g., Ferrari, Bentley or Porsche behind the glass. Super cars pull up for testing 2-3 minutes after customer selection and payment via touch screen on the ground floor. Autobahn Motors’ idea was the same, to differentiate itself from its competition with creative innovation and, at the same time, maximize utilization rate of immensely expensive, yet, underutilized land plots in Singapore.

Another similar project commenced in 2015. Carvana, a start-up used-car online retailer based in the US where car buyers trust to manage and complete financial contracts online in under 20 minutes, also launched a 5-storey building CVM in Atlanta, Georgia. Upon deciding on the make, model, condition and mileage, online car buyers are issued large coins to be used at the CVM location of choice upon picking up the car. Carvana also offers qualifying customers a special 7 Days No Questions Asked trial, where they are able to return purchased cars within 7 days after driving off the lot for no particular reason other than dissatisfaction after a few spins. The objective is that the special offers will create better trust and buying experience for the customers, and ipso facto, sales. Although up-front investment appears high, Carvana can actually save more as customers elect to pick the car up from the CVM. No delivery cost plus smaller operational overhead as the CVM operates with minimal or zero employees that are otherwise required to run vehicle warehouses and showrooms. Some dealers, on the other hand, are waiting it out to see how the CVM concept pans out economically.

The CVM is another example of a host of new innovative business models made possible by the IoT. 

Another interesting example regarded as the future of autonomous vehicles was first introduced at the Consumer Electronics Show (CES) recently under the Self-driving Ecosystem concept. It’s an awkward looking automated vehicle named “Snap” hauling passengers and goods around to designated destinations with intelligent transportation solutions like big data machine learning that enables it to analyze a variety of factors, e.g., distance, time, energy requirement, battery condition and rechargeability for different sets of transportation scenarios and select the best solution, from and to.

The Snap is designed as Mobility as a Service (MaaS) where the cabin or passenger pod can be dispatched from the skateboard-like chassis to serve as a temporary office, living space or shop vender along with other creative functionalities that require great mobility. The chassis and powertrain, which is typically a major snag by conventional waste management standards, is fully recycle-able, as well, thus adding another huge sustainable component to the smart city puzzle. En route, Passengers can manage the the pod through an app that uses AI to process data to determine desirable delivery time and feedback to inquiries such as traffic routines or weather conditions in real-time. As expected, Snap is also equipped with a basic feature expectable from any automated car, a sensor system that detects objects that impede the ability of the vehicle to run with optimal efficiently. Such application is expected to significantly reduce the amount of personal vehicles on the road and rekindle popularity of ride sharing, a model first introduced nearly half a century ago.

Snap gives us a glimpse of what future mobility ecosystems will look like. Benefits are million-fold and sustainable. Reducing traffic and pollution from the road as well as the city, is one thing. A whole host of creative functionalities come to light for pedestrian ways when minimal exhaustion can be expected from the road, thus, one of the largest public facility on the national scale revitalized over night, not to mention millions that switch to biking as a result of cleaner roads. It isn’t an overspeculation that by 2030 not only will we be looking at Smart City models, we will be walking through it and using its innovative venues at scale. Evident in the city of Nanjing, the capital of Jiangsu Province in China which began an IoT infrastructure, as Thailand 4.0 is attempting now, to manage traffic on the streets for more than 8 million commuters simply by streamlining bus data, traffic camera data and data from other related apparatuses into big data and processing it effectively. Over 100 million records are managed every day. Today, Nanjing is able to forecast and respond to traffic conditions in real time.

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