KPMG survey of car firm executives finds three quarters believe many of today's car owners will not want to own a car within a decade
Most car industry executives believe the rise of electric vehicles and driverless technologies over the coming decade will see diesel cars become a thing of the past, according to a KPMG survey.
Published today, the results of KPMG's Global Automotive Executive Survey 2017 reveal that 62 per cent of respondents believe diesel technology is well on the way to extinction, while an overwhelming 93 per cent of respondents said they were planning to invest in battery electric vehicles over the next five years.
Moreover, 90 per cent of UK car industry executives surveyed expect battery electric vehicles to dominate the automotive marketplace by 2025.
The report follows news last week of a bumper year for UK low emission vehicles sales in 2016, with figures for alternatively fuelled cars such as hybrids and battery electrics up 22 per cent on 2015. Carmaker Renault has also recently signalled it may stop selling diesel cars in Europe in the near future, while Volkswagen continued to face the fallout from the 'dieselgate' scandal today as UK VW owners today launched legal action against the firm.
John Leech, UK head of automotive at KPMG, said improvements in the cost and range of battery technology, coupled with growing concern over the emission of both carbon dioxide and nitrogen oxides from diesel engines, means "almost the whole automotive industry believes that the mass adoption of electric cars will happen during the next decade".
The survey also found 74 per cent of motor industry executives believe more than half of today's car owners will not want to own a vehicles by 2025, as self-driving technology and mobility as a service business models continue to mature.
Leech said he believed the UK was particularly suited to early adoption of self-driving cars.
"Our greenbelt policy has created a relatively dense urban population which, when coupled with our high fuel prices, means that so-called 'robot taxis' offer a greater cost saving to the UK public, compared to European or North American markets," he said. "I believe robot taxis will revolutionise UK urban transportation in the second half of the next decade."
A decline in car ownership would likely see automotive companies make far less money from manufacturing vehicles than currently, but 85 per cent of survey respondents signalled that their company would in the future shift towards generating higher revenues by providing new digital services.
"Today carmakers already make substantial profits from the sale of consumer finance and annual vehicle insurance but this will grow in the future as innovative services such as remote vehicle monitoring and the integration of the car as a focal point in people's ever more connected lifestyles are demanded by consumers," explained Leech. "More than three out of four executives believe that one connected car can generate higher revenues over the entire lifecycle than 10 non-connected cars."
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