Looking Out #23
Manufacturing as the next revolution or service as the paradigm shift? Arrival arrives while the TEE returns, auto design's diversity problem, the shifting posture of design, is design the problem?
Day Month, 2020
A newsletter about the auto industry, mobility, design, and the cultures that surround us. Brought to you by Joe Simpson and Drew Smith of The Automobility Group. If you like what you see, tell your friends!
A message from Joe & Drew:
It’s been a right old year, hasn’t it? In fact it’s been such a blinder that - for the last couple of months - it’s been all Joe and I could do to keep our day jobs and home lives on the straight and narrow. Relatively speaking, we’ve both had it very good, but it hasn’t been easy.
We offer this message to you by way of explanation for the radio silence of the last couple of months. When we started Looking Out, we promised ourselves that we’d treat it as a creative outlet, something fun to keep us plugged in to the world beyond the bounds of our desk. And creativity, let alone fun, has felt in somewhat limited supply of late.
Next year will be better. We’re sure of it.
On that note, we want to wish you a safe and happy holiday season. We also want to thank you for having joined us on this little experiment over the last 23 issues. We hope you’ll stay with us for the issues that are yet to come.
Cheers,
Joe & Drew
Auto
Canoo, Foxconn and the automotive manufacturing revolution | DS
Why it’s interesting: Outsiders, including the electronics manufacturer famed for its ability to churn out iPhones, are making a play for the automotive market.
Imagine a world in which the car, like a phone, becomes less about whats under the hood - most people don’t care about what chip drives their phone, or the specs of its camera - , and more about the experiences and the self-expression it enables.
For those of us that delight in the intricacies of automotive engineering and elegant, bespoke solutions, this may sound like a future devoid of fun, but I’d argue that most car buyers now no longer care how their car is built, or what motivates it, so long as its in line with their values.
And for car makers, worrying less about the enormous cost and effort of developing the technology behind the scenes to focus more on the things that will give customers reasons to part with their money can only be considered a win.
So it’s interesting to note that the two most visible platform plays of the last couple of months come from from non-OEM sources.
First up is Canoo, which has just published a cracking video demonstrating the flexibility of its skateboard chassis. Just another startup, you might argue, and one yet to produce anything at scale.
Then what about Foxconn? This is the company famed for churning out Apple’s iPhones with astonishing quality and consistency at almost unimaginable quantity. They’re also getting in to the automotive platform business, and they’re coming out punching.
By 2027, They’re hoping to capture 10% of the global automotive market with their recently-announced platform. That means there’ll be Foxconn powering 3 million cars per annum in just 6 years. It’s a startling ambition, and one that throws in to stark relief the role of the traditional automaker.
For what is an automaker - an original equipment manufacturer if you will - if the value of the product is no longer actually in its manufacture?
Desperately seeking service culture | JS
Why it’s interesting: premium is increasingly about service and service culture. An area in which the car industry is sorely lacking. Could it be the next paradigm shift?
What is service, in an automotive context? Apple’s service revenue hit an all-time high in Q3 of 2020. The company, famed for its physical products is fast transitioning to become a service-orientated company, partly to compete with the likes of Google, Amazon and Facebook. Back in Looking Out #5 I discussed BMW’s (now rolled back) decision to make Apple Carplay a premium subscription service.
Audi has recently announced the ability to ‘book selected functions’ after purchase – in some models, all car will be built with the high-end functionality (e.g. matrix LED lights, high-beam assist) which the user can pay to activate at purchase, or try out (for free, for a short period) and then pay to activate, via subscription, later. Teslas ethics over turning off software enabled functionality in this space were recently questioned, too. So this new type of subscription-paid for features/functionality looks set to become the norm. But will the customer view it favourably? Or as a price gouge?
I can’t help feeling that the auto industry is considering services from the perspective of its historic model. Build things, and simply charge people more for better/more things. The core tenet of a service like Netflix, is different. It delivers you a fundamentally better and different service (by an order of magnitude, and is ultimately cheaper) than a satellite TV subscription. Or the old fashioned video rental store. You pay for it because it’s better than something you knew in the past. It saves you effort, time and cash. It widens your horizons, offers more choice. It’s easy to use. Because everyone else has it, if you don’t, you feel like you’re missing out. I don’t think pay-per-use automotive features will provide quite the same sense of game-changing satisfaction.
Yet service is clearly about much more than this – it’s about how you, as the customer are treated. Service culture can define your relationship with the brand, what you feel is its personality and character and your likelihood to advocate for it and buy from it again – regardless of the product it centres around.
Good service culture typically isn’t defined as having a dig at your customers on social media:
Nor is it making a complete hash of things when the product fails you (although this happens to all brands from time to time):
But despite the above example being discrete , it underscores one of the challenges for the auto industry as it shifts to deliver services around and beyond the car – from one of essentially running sausage factories. In the future, there is likely to be more need for customers to interact with the brand.
Yet because the auto industry’s sales, delivery and service model is almost universally outsourced (OEMs even struggle to define and control the tone they wish to deliver to customers, via their own country-by-country importers), who the ‘brand’ is, is often different. It’s more likely to be a franchise, or third party outsourced to act for the brand.
And thus, creating consistent standards of tonality, behaviour and ethics is harder to deliver. If your own social media team can’t do it, why should you expect a third-party break down recovery agent late on a Sunday night, 11 hours into his shift?
They say that good service is often defined by what happens when things go wrong. But I feel there’s something more that’s missing here, and crucial in the auto world.
There is opportunity for auto brands to define service on their own terms, to make it a core brand standard and differentiator. Not by treating it as the things which swings into action when things go wrong. But by working in a positive and proactive (not reactive) way. By helping you get the most out of the car; by saving you effort, time and money. By interconnecting the car with other parts of your life and making it more useful or just generally harnessing the incredible power, vision and resource that sits at the heart of most car companies. By wowing you, making you feel special and make themselves the brand relevant in your life. Yes – cliché alert – by being more of an automotive Netflix. Ideally with a caring human being at the end of a phone line, someone who just maybe knows you by your first name.
Within the current way of doing things, it’s hard to image an incumbent winning out here. Start-ups and players from outside of the space seem more likely to be the winners as they structure differently and engage on different terms. But there’s an opportunity for someone. Because I’m certain that proactive, positive good service will increasingly become a key measure of successful future automotive brands.
Mobility
Arrival has arrived | JS
Why it’s interesting: it’s topical to talk about mobility as the e-scooter, the e-bike or any number of singular, micro-vehicles sitting in an eco-system. But what about reinventing the humble bus?
You’ve probably heard of Arrival. Or ARRIVAL as it more tediously insists on being titled. But that’s where the tedium ends, because the start-up, which last year secured investment from Hyundai, UPS and others that last year rolled out an amazing well resolved, cute as a button delivery van has now tackled the humble single decker bus as its next big move.
By rethinking vehicle industry convention, Arrival is challenging conventional wisdom around what’s possible in the world beyond passenger cars. Buses are built in a labour-intensive way in low volumes, which affects how they look (lowest common denominator design) and makes them expensive. It means they often have to source parts already in production and design for other vehicles.
But Arrival’s bus looks slick and modern, and features its own, slick-looking components. Why? According to the brand, partly because of its micro-factory set-up – which operates to typical car industry standards, but takes 1/6th of the time to set up and 1/10th of the CapEx. And the factories are one part of an eco-system wide re-think of the design process which includes a bespoke set of components, modularity and the use of recyclable thermoplastics to reduce weight all in the name of creating battery electric vehicles that have price parity with typical diesel vehicles. This recent video tells the story:
It’s impressive and sounds almost too good to be true – but then Arrival’s vans have already been ordered by investor, UPS, who has ordered 10,000 of them. And the company’s convinced that its approach and the combination of micro-factories, lightweight sustainable materials, modular components and in-house software means it’s onto a winner and can challenge conventional thinking.
How refreshing to see innovation or (sorry) disruptive principles being applied to products outside of the car world. Certainly, if the experience on board its bus is as refined and likeable as the aesthetic, it’s not too big a statement to suggest Arrival could revolutionise public transport. Watch this space.
The return of the TEE | DS
Why it’s interesting: After years in retreat, Europe’s night train resurgence just received another major boost.
For those that didn’t have a keen childhood interest in trains - cough cough - the Trans Europ Express, or TEE for short, was a network of first class expresses, like the glorious DB Class VT 11.5 above, that criss-crossed Europe at a thunderous pace.
Created to facilitate the original businessman’s trip, from the 50s to 90s, these dignified beasts would get you, say, from Paris to Strasbourg, or The Hague to Munich for a meeting, and then back again in time for dinner. It all seems so impossibly glamorous these days.
Sadly, the TEE network, like the more leisurely night trains, eventually withered and died, another victim of the arrival of the short-haul jet.
But this week, fans of both the TEE and night trains - yes, that’s me again - have cause for great cheer.
Starting in 2021, the French, Swiss, German and Austrian railway companies will roll out TEE 2.0, a greatly expanded network of night trains that will take you from Amsterdam to Zurich, or Paris to Berlin.
As someone who used to regularly spend the majority of a day travelling by jet to have a 2 hour meeting, the curtailment of air travel has been somewhat of a blessing this year. That said, I do miss the ability to spend a day or two with clients, walking the corridors and breaking bread over a pleasant meal or two.
As we start to move again and rebuild the relationships that have born the strain of endless video calls, I have to applaud the European rail operators for giving us a gentler and, yes, more glamourous way to do so.
Design
The shocking state of automotive design diversity and inclusion | DS
Why it’s interesting: The auto sector has long been known as a diversity and inclusion desert. A new report lays bare the scale of the issue.
Back in Looking Out #21, I wrote about how the industry’s successful response to the challenges ahead rests largely on its ability to attract more diverse talent, whether that be people from different races, geographic, socioeconomic and educational backgrounds, sexualities or genders.
A report released this week by Konzepthaus Consulting, an automotive industry consulting firm based in Munich, contains some sobering statistics to mull over.
On the topic of gender,
Women made up only 9.1% of the sample (n=209),
Women only account for 16% of entry-level and first level management,
There weren’t enough women from mid-to-senior level management from whom data could be collected.
There weren’t enough women…
This is the first study that Konzepthaus has published and, to my knowledge, the first of its kind in the industry. I can only hope that by highlighting the diversity disparities (the lack of data covering the other underrepresented groups is telling), we can start to address the issue across the sector, from education through to senior leadership.
Shifting the posture of design | JS
Why it’s interesting: Dassault Systemes’ Anne Asensio wants to stop design feeding consumerism and take it back to being a force for good.
I’m deliberately pairing my design and culture pieces this week, so please see this as a part a to the below’s part b – which provides something of an answer.
Anne Asensio has long been one of the car industry’s most significant figures. As a footnote to Drew’s piece above, she’s one of the few women in the automotive design space to hold – and have held – very senior positions. A force at Renault during the Patrik Le Quement era, and then subsequently GM, she’s the brainchild behind the revolutionary first Scenic and its interior, and now heads up Design at Dassault Systemes, the giant French software company which produces Catia – a cornerstone of the automotive CAD space.
Anne outlines how designers have historically fed consumerism, and how they now need to focus on using technology and software to fix and better the world – to design, for want of a better word, ‘for life’…
Culture
Carbon neutral? Net zero? Is design still the problem? | JS
Why it’s interesting: becoming carbon neutral by 2040 or 2050 is the commitment du jour for large, ethically-minded corporations. But are we still greenwashing?
I graduated from the Royal College of Art in mid 2008 and almost immediately began working as a consultant, for a media company that was retained by Ford. Finding my feet in a very brave new world of social media, while trying to work out how I turned this into a job in my chosen field of automotive design, I found a Ford that was working very hard to push a green agenda (not to mention keep itself afloat as the financial meltdown of 2008 occurred).
Greenwashing quickly became a term thrown around the office. While trying to critically engage with what genuinely represented news in Ford’s green efforts, the radical 2003 sustainability concept ‘Model U’ – created in collaboration with Bill McDonough – stood out. That it was sat gathering dust and apparently in too bad a state of disrepair for us to film told its own story, but the ideas developed within it lived on in Ford, and researching it and talking to those behind it lit a fire under me about sustainable design. Then Nathan Sherdorff’s ‘Design is the problem’ arrived in 2009, and it stopped me in my tracks.
I was part of the problem. Whereas every designer sees themselves as part of the solution (most of us aren’t in this to make the world worse), Sherdorff shone a rather too close-to-the-bone light on the reality of our role as pimp for capitalism, consumerism and throw-away culture.
Fast forward over a decade and I’m still engaged (and grappling with) sustainability and the concept of sustainable design. Most brands now claim to take sustainability seriously. The Paris agreement has seen scores of companies pledging to become carbon neutral – but what does that mean? And are big, heavily PR’d sustainability programmes such as those from Nike and Adidas in the world of fashion genuinely going to save the planet while letting us still have cool sneakers. Cake. Eat. Etc?
It’s a long read, but for anyone looking to try and properly un-pack the issues around this it’s worth checking out Emma Foster Geering’s exploration of Adidas x Allbird’s zero carbon collaboration is worth checking out.
You can check it out here.
As Geering suggests, the idea of saving the planet is a big marketing agenda:
from ‘climate positive’ burgers to ‘carbon negative’ vodka, ‘carbon neutral’ shipping options to ‘zero carbon’ coffee, these phrases now completely dominate mainstream marketing.
My key takeaways for those that haven’t the 18 minutes:
Carbon / green house gas emissions shouldn’t be treated as one and the same
Focusing solely on carbon can often distract from an industry’s bigger issues, such as toxic chemical and materials waste production, or causing deforestation.
Traceability and ethics in both the supply chain, and within the world of offsetting, carbon trading and auditing companies is at best dubious and at worst built on lies – helping us believe we can magic a problem into thin air.
Being truly sustainable is hard, labour intensive and necessitates large investment and often massive change. Focusing on one area (carbon) and using a few choice metrics is easy. Which is why so many brands do it.
And to wrap where I came into this, Geering concludes by asking:
Even so, the fundamental question still remains; how can millions more shoes be sustainable? What are they sustaining? And is this partnership sustaining an entire industry, or just themselves?
Design is still part of the problem, and bigger systems thinking approaches are needed to achieve true sustainability. And it’s hard. And expensive. The too long don’t read version? Don’t take carbon neutral or net zero at face value, or see it as the sustainability end game.
Pair with Azeem Azhar’s podcast interview with Jesper Brodin: IKEA: Making a $40 Billion Company Climate Positive
Image from: advanced fleet management consulting
Thanks to Autopap, Anne Asensio and Azeem Azhar for inspiring us this past fortnight.
That's it for this issue. We love feedback (positive and negative), and to answer any questions you have. So email Joe or Drew and we’ll get back to you.
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