This Master’s thesis studies the ways new technologies affect the automotive industry’s value chains. The industry’s revenues are shifting from hardware to software and from products to services, influencing the traditional players’ roles, business models and operations, and attracting new players from other industries. The trends driving these changes are based on connectivity, infotainment, ADAS, autonomous driving, and new mobility services. This thesis also investigates what possibilities these changes can bring to Finland.
In this thesis, theory about value creation and value chains was studied from literature. Technology trends and changes in the industry’s value chain structures were studied by getting information from literature and interviews, and by analyzing the traditional players’ activity on acquiring capabilities related to new technologies.
Many of the new innovations will come from other industries, and especially the number of agile players entering the automotive market from the ICT-industry are likely to increase. These new technology suppliers and service providers have become a part of the automotive value chain, complementing it to help answer the customer demand and safety regulations. New technologies are shaping the value chain and forming a value network around the traditional tiered value chain. The traditional players need to gain internal and external software know-how and cooperate with the new entrants to succeed in developing intelligent vehicles and bringing new kinds of services to the customers.
The broad Finnish expertize on multiple areas can be transferred to answer the needs of the automotive industry on connected cars, autonomous driving and developing new services. However, Finland needs more companies, deeper understanding on how the automotive industry works, and raising awareness about Finland’s innovative ecosystem in order to succeed in the automotive market and to attract foreign investments
