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By Holger Masser, Global Head of Industrial Business Unit Automotive at SAP AG

Internet connectivity and embedded sensors are connecting today’s vehicles to their drivers, to other vehicles, and to the surrounding environment. Some call this the “Internet of Cars,” with cars being the ultimate mobile device. Increasingly, people are familiar with the in-car entertainment, wireless, and GPS elements of connected cars.

But many opportunities exist when it comes to the connectivity of today’s vehicles impacting driving logistics, fleet management, product quality, warranty management, and asset management, to name a few. Consider these examples.

Insurance companies

Insurance companies could collect data transmitted from insured vehicles and available  telematics to understand driving behaviors and patterns. They could then define insurance rates accordingly.

Car manufacturers

Car manufacturers could monitor data about the performance of components throughout the vehicle to understand its status – regardless of how it is driven. By aggregating and analyzing data, they can predict the likelihood of a part failing and proactively recommend issue resolution to avoid a warranty claim.

On the production side, car manufacturers could monitor their factory equipment to identify problems with machines producing all the components that go into their vehicles. In this way, they can plan maintenance and adjust machine schedules to ensure their production lines are running smoothly.

Asset management

By capturing signals from devices attached to their factory and warehouse assets, manufacturers can better and more easily manage those assets. For instance, at every point in time, a factory manager could see machine schedules and operation details online, in real time, for the company’s entire inventory of factory machines and production component inventory. This eliminates the need for someone to visit the shop floor to check on inventory or machine status.

Supply chain logistics

This connectivity and embedded intelligence are even changing supply chain logistics. Companies can track containers as they enter a port, identifying whether they contain hazardous materials, require cooling, and more. They can also precisely identify the contents of each container. As a result, if a company urgently needs certain parts for its production line, the port authority can take the container out of sequence and expedite delivery. This capability enables even better yields from just-in-time and just-in-sequence production processes. 

Fleet management

Connected cars can change the way that fleets are managed by both rental car companies and large corporations. By connecting all cars in the fleet, these companies can gather insights that enable optimized management. For instance, they can track how their cars are driven, whether maintenance is required, how often the vehicles require repairs, and more. In turn, they can train drivers on the best driving behaviors and negotiate better maintenance rates with automotive aftermarket service providers.

These new capabilities can make new business models possible. Consider a commercial transport company – rather than simply transport loads from point A to point B, the carrier could better optimize its capacity and routing. Imagine a truck has the capacity to handle 80,000 pounds but has only been loaded with 70,000 pounds worth of cargo. The carrier could monitor all dispatches from a central location and see in real time that this truck will be passing another customer that needs 10,000 pounds hauled. The dispatcher could add that stop to the route, enabling it to move a truck at full capacity without disrupting the route. The carrier will generate higher revenues from the trip and conserve fuel by avoiding the need for a separate pickup and delivery.

By coming to smart conclusions about all the data signals from their assets and the surrounding environment, companies can improve their operations, offer new services, and compete more effectively. Behind all of these possibilities is a cloud platform with business intelligence tools that make it possible to access, visualize, and analyze  millions of data points in real time.

How do connected cars promise to change your business? Please share your thoughts in the comments or send me a tweet.