Car manufacturers are competing with technology companies for the global innovation industry, boosting research spending to build greener, smarter and more connected cars. Emission curbs, efficiency rules, the rise of the connected car and increased competition from non-traditional rivals such as Tesla and Google are all forcing automotive engineers into the labs and sending research and development to record levels.
Study conducted by the Boston Consulting Group concludes that nine of the top 20 most innovative companies this year are carmakers. For the first time in 8 years automobile industry beats technology and telecoms companies.
“This is an intensively research-heavy period for the car industry given all the disruptive technologies emerging,” said Hadi Zablit, co-author of the report.
“For automakers, after the 2009 crisis the only way out was innovation,” said Mr Zablit. “Despite the headwinds, focusing on innovation was seen as the right thing to do.”
More than 70% of respondents in the automotive industry said they would increase spending on new innovation this year, according to the report released on today.
“We are also seeing a resurgence in recognition for the ability of traditional manufacturers to innovate in product, process, and technology,” said Kim Wagner, another co-author. “Auto companies are leading the way.”
Car manufacturing in Europe was hit the most by the financial crisis causing heavy losses to Peugeot Citroen, Renault and Fiat. However, despite the negative economic conditions companies sought to develop more efficient engines and electric-powered vehicles, while new innovations such as cars that can drive themselves or connect to the internet are creating fresh technology challenges for the industry.
Nissan, Mercedes-Benz and others are spending heavily on developing self-driving cars, one of the fastest-growing areas of innovation in the industry, amid competition from the likes of Google and luxury newcomer Tesla.
General Motors and Volkswagen were two of the highest risers in the study, joining automakers Toyota, Ford, BMW, Hyundai, Honda, Audi and Daimler in the top 20. The study also found that technology companies Apple, Samsung and Google were the world’s most innovative.
Those tech and carmaker giants are expected to innovate the most. Although some of their products may disappoint in a short term those companies are the core of keeping industry highly competitive.
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