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An exploration of the business models driving automakers to be purpose-driven
A large share of car owners in Asia primarily purchase a vehicle for its utility. The personal mobility space is matured, and car owners want to maximize value for investments made. This trend has affected not just car manufacturers but also the supplier ecosystem, which has resulted in low car sales and profitability, layoffs, and more. To address these issues, Asian automakers are launching new products, smart features, and more, but they haven't yielded results. This paper, thus, relooks at the Asian automotive business models, with a focus on mobility. Two business models that will dominate the Asia-Pacific region are-
- Car ownership and shared mobility: By making private ownership and shared mobility complementary, car owners can generate revenue from their vehicle.
- Platform aggregators: While platform aggregation already dominates the Asian market, it can be scaled further through freight uberization.
Ecosystem partnerships will further drive these business models. Carmakers that operate on purpose-driven models along with an innovation partner will gain the upper hand.
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