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The Digital Age Is Already Here, Especially in the Automotive Industry

Feature Article | September 12, 2017 by Stephan Brand

At the IAA fair in Germany, SAP features smart mobility in metropolitan areas and provides solutions for environmental zones and e-car fleets.

The automotive industry is facing fundamental change. It is not simply about connecting a smartphone to the car’s infotainment system so the driver and passengers can access Spotify or call up Google Maps to navigate. These are standard today, so much so they are hardly worth mentioning. New cars that do not have this connectivity simply do not sell.

So, what fundamental change might that be? It is ultimately about smart technology and providing platforms that connect up with vehicles, infrastructure, charging stations, and so on by way of sensors. Data is exchanged and analyzed, and services are offered. That way, ultimately, customers, SAP, and SAP’s partners can conceive completely new business models.

According to the Roland Berger E-Mobility Index for Q1/2017, it is looking good for the electric vehicle market. The index’s technology indicator showed that Germany is now one of the leading countries in this domain. Roland Berger also reported that municipalities were pressing ahead on emissions legislation: In a number of major Chinese cities, obtaining a vehicle license plate was already conditional on the type of engine; and in 2020, London would introduce an Ultra Low Emission Zone; Paris was looking to ban diesel vehicles from 2020; and Norway was considering banning all fossil-fuel-based cars from 2025. For me, this also means that any software company unable to offer IoT or a cloud platform has basically already lost the digitalization race in any industry.

At IAA New Mobility World 2017, SAP features a smart city showcase that addresses precisely the same question as the E-Mobility Index: the future of urban transportation in ultra low emission zones like the one London is planning for 2020. Our Smart City Showcase demonstrates how, for instance, machine learning, the Internet of Things, blockchain, Big Data, and customer-oriented services can help bring about new business models and will shape urban life in the near future for people, the public sector, and for businesses.

The following scenario could hardly be more topical: You want to drive into a city that already has low-emissions zones and you, as a driver, are charged for entering those zones. In our example, the charge for driving into the center is €20. A message is displayed on a screen in your car asking whether you want to switch to the vehicle’s electric motor or whether the car’s emissions should be kept to a defined limit. The better your car is at keeping emissions at or below the limit, the less you are charged. Because the vehicle is connected with a control center for the city, and this data can be processed in real time on a cloud platform, the vehicle can be tracked right away and the charges billed. This is called “pay as you pollute.” London is already planning to introduce this type of model.

Another example is smart monitoring of transport infrastructure: Virtual reality and 3D printing will in the future be used by a city’s maintenance technicians to carry out repairs at the moment a fault occurs.

Vision: E-Fleet

I would also like to mention a joint project with EWE, Germany’s fifth-largest energy company. We are working together to build a prototype solution for operating an electric vehicle fleet. Pilot customers have tested the prototype and it is very likely to be launched as a product soon.

SAP and EWE first looked at the needs of corporate and leasing vehicle fleets, and fleets of carpool vehicles, in other words B2B and B2B2C business. The solution can be extended in the future, of course, where we are looking at two more dimensions: public infrastructure for charging electric vehicles for B2C customers, and how we can incorporate other moving assets such as electric forklifts, bicycles, buses, trucks, and even drones. At present, we are working on creating a common platform that can accommodate different types of transportation applications and that is easy to use and that partners can also extend.

Both companies want to build a standard software solution for a system open to all manufacturers, vehicle models, and charging infrastructures for mixed vehicle fleets. At the heart of it is smart charging and load management in which e-vehicles are charged according to a schedule so that available capacity is allocated to the vehicles in the most efficient way. Battery charging is prioritized by available electricity and by vehicle: emergency charging takes priority over minimum range charging; minimum range charging is a priority over desired range charging. It would also allow for the cost of or market prices for electricity and the allocation, or balancing, of power across the infrastructure. It should also provide customers with an app for using charging stations and that perhaps also shows potential rideshares.

Stephan Brand is senior vice president of development and marketing strategy for SAP innovations for moving assets

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