Finding new approaches to innovation will be one of the best paths forward for the auto industry as it responds to changing consumer interests and the turmoil created by COVID-19.
In the first of a three-part series of virtual Automotive News PACEpilot events, industry leaders said ingenuity — particularly through employing different business models and providing unique customer experiences — is the key to success amid so much upheaval.
PACEpilot is a new Automotive News program that recognizes innovations from suppliers and startups that are through the pilot phase but not yet commercialized.
Such innovations will separate the winners from the losers in the industry, Joe Vitale, global automotive sector leader for Deloitte, said during last week's webcast.
"Innovation has always been the lifeblood of the auto industry. It was before COVID, it will be during COVID, and it will be after COVID," Vitale said.
Vitale said the industry is seeing a shift from innovation that has, historically, been centered on product and manufacturing to innovation focused on consumer desires.
"The one trend that is very significant is this movement from product-focused innovation to customer and experientially focused innovation," Vitale said. "Many companies, the way in which they are going to differentiate, is how they can innovate around new business models that drive better and more enriched customer experiences."
It's important for automakers and suppliers to overcome the disruption to business operations and innovation resulting from shifting consumer preferences and COVID-19, said Francesco Fazio, principal at Doblin, a Deloitte unit focused on innovation, strategy and human-centric design.
"COVID is only adding further disruption and pressure on an industry that was already going through some anticipated change," Fazio said. "There are some tiny signs of recovery for the industry, but the primary imperative is really business agility. Cash is king. We cannot just innovate like we used to innovate before. We need to think more holistically about, 'How are we going to change our businesses to survive?' "