enterprise solutions, technologies

Changing gear with smart technology

Technology and vehicles: not blue sky thinking. Simple black and white.

Reselling cars might not be the most obvious place to find innovative new uses of mobile technology, but together with a free lunch and a trip to Microsoft’s shiny London HQ (strong on Windows) it was a topic which attracted some of the UK’s major car buyers and sellers.

The British Car Auctions (BCA) event set out to examine the intersection of mobile technology with selling vehicles, the wider economic importance of which cannot be understated.

Indeed, Christopher MacGowan OBE introduced the event with the arresting fact that today’s market generates £8.5 billion for the British economy.  There are seven volume factories in operation in the UK and eight Formula One teams are based in the country.

MacGowan also stressed that the UK shouldn’t be isolated from the global marketplace.  In 2010 the Chinese new car market was larger than the United States and its new car market value is expected to exceed America’s by 2014, propelled by higher profit margins.  Up to seven times as much profit can be earned by top brand cars in China than in the UK, which can put the UK market in a tricky position.

However, with so much cash swilling around a global marketplace, perpetual market fluctuation and consolidation will be a given, with even the comparatively small opportunities being significant, not least for technology providers.

Environmentally friendly electric cars will have an impact on the market; the scale and precise nature of which largely remains to be seen, according to MacGowan.  But how the market prepares for the influx of second hand electric vehicles, and how electric vehicles stand the test of time and miles, will have a growing impact on used vehicle profits.  Connected technologies will be key to this.

Mobilising BCA

Jonathan Higham of British Car Auctions (BCA) kicked off the presentations with an overview of BCA’s place in the market.

BCA now boasts 46 auction centres across 11 countries and will sell over 600,000 cars in 2011.  Of these sales 20% are now sold online, giving more eyeballs on vehicles and greater reach.  Electronic online bidding hasn’t slowed down the auction process but instead gives considerably more detailed information, enabling 750,000 monthly viewers of BCA’s online Auction View to make better informed decisions.

Added to this is a greater stream of data accessible on the go.  Mobile data means notifications can be delivered when bids are offered and accepted, while buyers can send a text message containing a vehicle’s registration number to a short code, and receive information back about that vehicle.

There have been operational benefits too.  Channel remarketing requires knowledge of where any vehicle is at a given time, both physically and virtually.  That is, where it is parked and where it is positioned in the supply chain.  This information can be passed to users thanks to TBS Enterprise Mobility’s TaskMaster software, running on Windows Mobile operating systems inside Motorola devices.  As well as delivering information into the field, the software can dynamically formulate essential workflow statistics and monitor where field staff are throughout their working day.

Technology and the used car market

Richard Richmond of Lombard was then welcomed for an interview with Christopher MacGowan.  Questioned on today’s market, Richard explained that the market is in a transient state of consolidation with mergers and acquisitions, and such changes will always occur.

But it was agreed that technology adoption has been rapid and significant.  Only five years ago operations were being conducted almost exclusively using spreadsheets alone, and such rigid dependencies forced the market to embrace new technologies.

Tellingly, one of the day’s largest audience reactions came from Richard’s response about customers selling vehicles:  “Sometimes they lie, don’t they?”  A pithy inconvenient truth, combatting the ability to conceal information is a primary objective for new technologies deployed, with functions such as image capture and GPS tracking helping to prevent any falsification.

Richard went on to discuss the impact of hybrid vehicles on the market.  The unknowns of a 4 year-old hybrid vehicle’s performance or battery life will be hugely important to any resale price and the market will have to adapt to these unknown values, with a consequence that some will inevitably get burnt.

Responding to a popular question about the shortage of used cars in the retail end of the market, Richard offered an optimistic, alternative view based on perceived over-supply to the market.  Any under supply will be balanced out by earlier over supply and a correct level will be found.  External factors were also flagged as influential to the shrinking retail market.  With potential interest rate rises, mortgages will rise too, leaving less disposable household income for cars.

The technologists’ take

Microsoft’s Developer Evangelist Paul Foster then took the stage.  Paul explained how mobile devices have effectively consumerised IT, giving everybody the power to harness technology for their own needs, through a wide range of devices and applications, inside the home, the office and the car.  It served to underline how all industries can prepare for consumer use of smartphone technology to translate to any sector by considering how best to touch customers, and make everyone’s lives easier.

Steve Reynolds, CEO of TBS Enterprise Mobility – the technology delivery partner for BCA – focussed on the aspects of everyday life which are converging with mobile technology and how these are multiplying.  He explained how the benefits of mobile telemetry and data transfer technology will grow clearer, increasingly helping to avoid traffic congestion, improve fuel efficiency and give new safety features.

With reduced traffic congestion comes reduced Carbon Dioxide emissions.  It has been calculated that a free-flowing road produces 20% less Carbon Dioxide than a congested road, hence the commitment towards reducing traffic congestion by almost any means.

Why wouldn’t you?

A closing Q&A session yielded several reasons for scepticism around adopting mobile.  Are buyers more savvy than sellers, with portable smartphones listing up-to-the-minute retail prices?  Can anything sellers do compete with them?

When will mobile coverage be better everywhere?  My signal is still poor in certain places.

Arguably most interesting was the question around the reliance on paper forms in the buying, insuring and taxing processes.  Why does there remain such dependence and can’t an implanted NFC chip contain all this data?  Here lies a common inertia which technology providers struggle against, day-to-day.  Implicit trust will come eventually, with time and secure, unimpeachable solutions.

A snapshot of the industry revealed a cross-section of successful businesspeople who knew their complicated supply chain industry intimately well, and were open to learning more.  Interesting to observe will be how broadly mobile is adopted, how attitudes towards technology do change, and how far engagement effectively percolates down the chain.

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