Latest blog from James Davis

Horses, vacuums, vehicles and why disruption isn’t new

In this latest article James Davis, Customer Strategy and Insight Director for Commercial Vehicles, considers the impact of disruption in our sector and the strategic view of Cox Automotive looking to the future.

News broke last month that Sir James Dyson has canned his multi billion pound EV start up.

With Sir James unable to find a buyer I’m sorry for the team and suppliers and am hopeful, with their EV and motor related skill sets, they will recover and resettle quickly.  Today's “disruptive” market forces have themselves evolved and combined to become more complex and more disruptive.

Dyson made its name by taking on the 'Hoover' household name with a radical lifestyle design, new cyclone technology and a more expensive price tag - it shook up the market but I suspect that applying the same approach as a start-up today would be less likely to succeed. The world has moved on, did Sir James ever envisage the need for a cordless, robotic, self-driving vacuum cleaner?

Made me think. What was ever wrong with a cellular phone, a landline, a fax, a pager, a telex, a carrier pigeon, a dustpan and brush? Nothing! They did the job in their time, but clearly we move on. Today’s communication and technology worlds have been made ever faster and more flexible with broadband, 4G and smart phones. No doubt we’ll look back at 4G in a few years’ time and wonder how we ever coped with it.

Elon Musk, infamous EV disruptor and co-founder of EV OEM Tesla, once said “When Henry Ford made cheap, reliable cars people said, 'Nah, what's wrong with a horse?' He went on to expand the horse analogy, I can't repeat that here. However Tesla has experienced well publicised production delays and is under pressure to ramp up production as, by Elon's own admission, recently secured funding only provides a few months of security.

Online and digital distribution and sales strategies are evolving. The retail high street and physical estates of roof tops are under pressure. Low barriers to entry are seeing many businesses, especially OEMs, invest billions in buying into tech start ups and future tech. From Artificial Intelligence to Electric Vehicles, Mobility as a Service to Robotics and Autonomous Vehicles the degree and scope of disruption will be felt in the future as these areas overlap and interact across so many sectors.

Disruption is a constant and can be seen as a series of phases. As human beings we are pre-programmed to be wary of change, but our ability to adapt has been part of our success as a species. We have evolved over thousands of years, and will continue to do so providing we finally take action that protects our planet.

Today's disruptive change phase is arguably happening at the most incredible pace ever seen, and it’s largely driven by digitalisation as well as technological advancement. This is certainly true in automotive. Physical services, with their inbuilt timelines and time-lags, are no longer widely accepted. It's more about the wag now than the dog or its tail.

Business are increasingly leveraging the power of their brands and brand values to lead an ever-growing generational pool of "time poor" customers to digitally interact and transact. When compared to start ups, established businesses have the additional task of evolutionary transformation. As well as investing to bring competitive new products and services to market, they have to re-balance their legacy cost bases - a major factor for survival and future growth.

I had stark confirmation at April's SMMT Connected conference from the global president of Toyota: "Google, Facebook and Apple keep me awake at night. My mission is to take us from an auto maker to a mobility business. Like those brands Toyota didn't start by making cars" (I didn't appreciate they started by making clothing looms)

Off the shelf software and hardware solutions provide low barriers to entry. They empower agility in the right hands. But - let’s not forget what has driven business for hundreds of years: People. Proposition. Customers.

Cox Automotive is owned by Cox Enterprises, a 4th generation 121 year-old family owned business that has evolved through the disruption of newspaper to radio to TV to cable. We have divested and re-invested over this time to ensure we remain relevant.
The Cox Automotive strategy is clear and exciting. Take our decision to invest $350m in US EV start up Rivian as an example. This came on the back of Amazon investing $440m and Ford a similar number in Q1 this year. The value we could bring to this EV OEM in terms of our digital and physical footprint and fulfilment strategies make it a perfect fit. The environmental benefit also underpins our own Cox Conserves culture and activities.

For me it’s not about backing the wrong horse. It’s about insight. It’s about identifying growth sectors and opportunities, designing and adapting an agile strategy then employing and harnessing the stamina required to win. Our people are our strongest assets and in Cox Automotive we build a sustainable future for our team members, their families and communities. It’s an exciting future, full of opportunity.

Failing fast is therefore not a weakness but a realisation that horses, vacuums and vehicles all have a place in our world, like us they are just evolving...