Why electric cars are like smart phones

Electric cars charging in Amsterdam
Selling electric cars in the same way as mobile phones could boost sales, says Simon Donohue in the Telegraph. In his article he draws parallels between the marketing practices of mobile phone companies and operators and car manufacturers. He heads the article with “Why electric cars could be sold like phones”. The popular answer might be: because they can! However, the parallel between EVs and smart phones does not stop when the sale is done. Electric vehicles can generate very attractive additional sources of income with apps.
With a fossil fuel car a manufacturer typically makes money from the sale of the car and supplying after sales service, in particular parts. Fuel, insurance, road tax and parking fees are cash inflow for other companies than the car manufacturer, although these are strongly related to the car itself. Of course one can think of a few exceptions to this rule. Such as a car brand issuing a private label car insurance.
When you park your electric vehicle in an inner-city you pay for the electricity for your car to the operator of the charge point. At the same time you pay a parking fee to the municipality or the owner of the parking lot. In a growing number of cases you can pay the parking fee with a smart phone app, such as Yellowbrick, Paybox, Parkmobile, Parkline etc. It is a no brainer that these two payment streams could be combined to the convenience of the EV owner.
When the car manufacturer is the issuer of the card that unlocks the charge point, the company controls a completely new revenue stream. It takes little imagination what other services could be unlocked with such a payment system.
Most major manufacturers have already published about their plans to supply services in and around their future cars. For instance, Renault has even taken it a step further for their Zoe electric vehicle. They founded a ‘Connected Mobility’ start-up incubator to encourage the development of apps for their Zoe EV.
It is obvious that digital technology and connected cars represent a huge opportunity for car brands to increase revenue and regain margin, while they are in an industry that is pressured by excess capacity en evaporating profits.

2 thoughts on “Why electric cars are like smart phones

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